The Congress party faced a setback as the Income Tax department issued a notice amounting to approximately Rs 1,700 crore, which includes penalty and interest, covering the assessment years from 2017-18 to 2020-2021. This action by the tax department came shortly after the Delhi High Court rejected the party's plea challenging the reassessment proceedings for the mentioned assessment years.
The Congress party, already grappling with a cash crunch due to frozen bank accounts, is now faced with the additional burden of the I-T notice. Congress lawyer and Rajya Sabha MP, Vivek Tankha, verified the receipt of the notices and mentioned the party's intention to contest them, denouncing the move as 'undemocratic and unreasonable'. Media reports have highlighted that the tax department has already collected Rs 135 crore from Congress's Delhi bank accounts towards tax arrears and interests for the assessment year 2018-19.
The Delhi High Court's decision to refuse interference with the initiation of reassessment proceedings for another period comes on the heels of the dismissal of a prior petition by the Congress party which contested the initiation of reassessment proceedings for the assessment years 2014-15 to 2016-17. The court mentioned that the I-T department had presented convincing evidence necessitating further scrutiny, despite the Congress party's objections. The tax authority had indicated an alleged escapist amounting to approximately Rs 520 crore during those three years, resulting in the initiation of reassessment proceedings. Furthermore, reports suggest that the tax department pointed out cash transactions involving Congress during searches on entities, including those reportedly associated with the Karnataka Deputy Chief Minister D K Shivakumar and a company in Surat, alleging a violation related to tax exemptions designated for political parties.