NEW DELHI: Clearing the air on tax exemption with regard to depositing old notes by political parties, the Finance Ministry today categorically said they do not enjoy “any immunity” and are liable to be questioned like anyone else by the tax authorities.
Revenue Secretary Hasmukh Adhia clarified that political parties can not accept old 500 and 1,000 rupee notes as donations as both these bills have ceased to be legal tenders.
“All reports on the alleged privilege to political parties are false & misleading. Political parties have not been granted any exemption or privilege, post demonetisation & introduction of Taxation Amendment Act, 2016,” he said in a series of tweets.
“Post demonetisation, no political party can accept donations in Rs 500 and Rs 1,000 notes since they were rendered illegal tenders. If there is any discrepancy, political parties are as liable to be questioned by IT authorities as is anyone else. They enjoy no immunity,” he added.
He said that income and donations of political parties fall in the purview of Sec 13A of the Income Tax Act 1961 and there is no change in its provision.
“This is a provision of law which is more than 35 years old and no change is made in that now,” Adhia said.
Earlier the Central Board of Direct Taxes said that there are enough provisions in the Income Tax Act to scrutinise the accounts of political parties even though their income is tax exempt. (AGENCIES)
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