SC rejects plea against tax sop to parties

Legal Correspondent

New Delhi, January 11

The Supreme Court on Wednesday refused to entertain a PIL for withdrawing the 100 per cent income tax exemption enjoyed by political parties and a CBI probe into the surge in political funding following the November 8 demonetisation of high value currency notes.

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A bench headed by Chief Justice JS Khehar said there was no merit in the plea by advocate-petitioner ML Sharma.

Sharma had sought quashing of the laws under which political parties enjoyed I-T exemption and did not have to disclose the source of funds amounting to less than Rs 20,000 each.

Both Section 13A of the Income Tax Act 1961 that exempted parties from payment of tax and Section 29 of the Representation of the People Act 1950 allowing anonymity to donors to political parties provided the amount was less than Rs 20,0000 were there for decades.

Sharma pleaded that nobody was spared of paying income tax and it would be in the fitness of things that political parties also paid tax. There was no logic in exempting political parties which did not even find mention in the Constitution, he said.

The two exemptions were responsible for political corruption and generation of black money, he contended.

Unless swift action was taken, political parties would siphon off the huge funds they received in the form of banned currency notes and deposited in banks, he pleaded.