Months ahead of national elections, the main opposition Congress party in India announced on Friday that a disagreement involving an income tax claim of 2.1 billion rupees ($25.3 million) had resulted in the freezing of its bank accounts.
Despite this, the party was able to partially run its accounts until February 21, when the income tax tribunal was scheduled to hear the issue. The party described the action as “a deep assault on India’s democracy”.
Congress treasurer Ajay Maken informed reporters that following the tax department’s directive to banks to freeze funds in the party’s accounts, the party had lodged a complaint.
“We learned two days ago that the banks were refusing to honor the checks we were issuing… We don’t have enough money to cover our staff’ salaries or the cost of our electricity,” Maken stated.
Maken added that the party’s membership drives and crowdsourcing campaigns contributed to the blocked accounts, and that the disagreement with the tax department was related to a problem that occurred between 2018 and 2019.
Calls and texts for comment were not answered by the income tax agency.
According to a person with knowledge of the situation, Congress was required to pay 1.05 billion rupees in taxes in this case; however, due to payment delays, this amount had increased to 1.15 billion rupees, and as a result, the party’s accounts were frozen with an equivalent amount.
“Funds are still being sent to and received by Congress. The insider stated, “Rules will be followed to recover 1.15 billion rupees. This is routine procedure with those not paying taxes.”
The tax department’s move comes just a few weeks before the dates for the general election which must be held by May are scheduled to be revealed.
After Prime Minister Narendra Modi stormed to power in 2014, the Congress, formerly the most powerful party in India, has fallen to all-time lows in both the parliament and numerous states.
Congress president Mallikarjun Kharge wrote on X, saying, “The country’s largest Opposition party has had its accounts frozen by the power-hungry Modi Govt.” “We appeal to the Judiciary to save the multi-party system in this country and protect India’s Democracy.”
Power drunk Modi Govt has frozen the accounts of the country’s largest Opposition party – the Indian National Congress – just before the Lok Sabha elections.
This is a deep assault on India’s Democracy !
The UNCONSTITUTIONAL money collected by the BJP would be utilised by them…
— Mallikarjun Kharge (@kharge) February 16, 2024
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