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Income tax department uncovers donation scam involving unrecognised political party in Chhatrapati Sambhajinagar

In ongoing searches carried out by the Income tax department at more than 200 locations across the country for false deductions by political parties, the I-T teams in Chhatrapati Sambhajinagar unearthed a massive scam involving crores of rupees routed through an unrecognised political party under the guise of donations eligible for tax deductions under section 80GGC of the Income tax Act, 1961.

Income Tax in Media

Dept asks donors to parties why their I-T deductions shouldn’t be scrapped

Taxpayers who donated to Registered Unrecognised Political Parties (RUPP) to claim deductions under Sections 80GGC/ 80GGB of the Income Tax Act have started getting show-cause notices from the department. These notices question why the deduction should not be disallowed, as these political parties have confessed that most of the donation was returned to the ‘donors’ after taking a cut. Chartered Accountants said that donors will be required to reply to these notices soon and it is likely that the department will issue orders before the end of March.