ITAT Rejects Congress Plea for Tax Exemption
Calling for a strict interpretation of the exemption clause, the ITAT observed that "the moment there is violation of such a “due” date, Section 13A 3rd proviso gets attracted, so as to result in denial of exemption to the political party concerned."
New Delhi: The Income-Tax appellate tribunal (ITAT) has dismissed an appeal by the Congress seeking income-tax exemption for the income of Rs.199.15 crore during the assessment year 2018-19. It said there was a violation of the conditions in Section 13A of the Income-Tax Act. The returns were filed late, the ITAT noted.
Calling for a strict interpretation of the exemption clause, the ITAT observed that "the moment there is violation of such a “due” date, Section 13A 3rd proviso gets attracted, so as to result in denial of exemption to the political party concerned." The tribunal referred to the Delhi High Court's judgment which held that "no deduction can be allowed with respect to the expenditure incurred by the political party for any purpose whatsoever if it fails to comply with the basic requirements of section 13A of the Act." The “due” date for the exemption was October 31, 2018.
The Congress filed its return on 02.02.2019 declaring "nil" income after claiming Section 13A exemption of Rs.199,15,26,560. The party contended that since the return was filed much before the last date of filing of return of return on 31.03.2019, the disallowance made and sustained is not in accordance with law.
The ITAT rejected the argument, stating that the return filed after the "due date" cannot be accepted. In 2024 too, the ITAT had already rejected Congress’ request for interim relief.
