Congress Faces Setback as Income Tax Tribunal Upholds Account Freeze

In a major setback for the Congress party, the Income Tax Tribunal has dismissed its plea to stay the freezing of four bank accounts by the income tax department. This decision comes ahead of the 2024 Lok Sabha election, posing financial challenges for the party. Advocate Vivek Tankha, representing Congress, requested a 10-day deferment to approach the high court, but the tribunal bench declined, leading to a significant blow for the party.

Income Tax Department’s Seizure and Allegations

In February, the income tax department seized four main bank accounts of the Congress party, citing an income tax demand of ₹210 crore for the financial year 2018-19. The party approached the tribunal seeking a stay, emphasizing potential difficulties in meeting financial obligations, including bill payments and salaries, if the accounts remained frozen. Congress treasurer Ajay Maken alleged that, pending the hearing, the income tax department instructed the transfer of over ₹65 crore from Congress, IYC, and NSUI accounts to the government.

Congress’s Response and Allegations

Reacting to the tribunal’s verdict, Ajay Maken characterized it as an “attack on democracy,” particularly given the proximity to the national elections. Maken asserted that the party would explore legal options and approach the high court to challenge the tribunal’s decision. He questioned the unprecedented demand of ₹210 crores, contrasting it with the perceived exemption of national political parties like the BJP from income tax payments.

Details of the Income Tax Case Against Congress

The income tax case revolves around allegations that Congress did not fulfill its income tax obligations for the financial year 2017-18, with initial dues of ₹103 crore and ₹32 crore in accrued interest. The dues were reassessed at ₹105 crore on July 6, 2021. Despite some payments during the legal proceedings, the party did not dispute the total tax-due amount, leading to the ongoing financial challenges.

The Congress party remains resolute in its commitment to contest the tribunal’s decision, highlighting its impact on democratic processes and expressing its intent to seek justice through legal avenues.