On March 12th, the Delhi High Court reserved its verdict on the tax recovery dispute involving the Congress party. The party sought a stay on the Income Tax Department’s notice demanding over Rs 105 crore in outstanding taxes. The court reserved judgment after hearing arguments and indicated no apparent flaws in the Income Tax Appellate Tribunal’s ruling.
NEW DELHI: Today (12th March): The Delhi High Court reserved its verdict on the Congress party’s petition seeking a stay on the Income Tax Department’s notice for the recovery of over Rs 105 crore in outstanding taxes. The court, however, indicated no apparent flaws in the Income Tax Appellate Tribunal’s (ITAT) ruling that dismissed Congress’ stay appeal.
The bench, comprising Justice Yashwant Varma and Justice Purushaindra Kumar Kaurav, heard arguments today and reserved its judgment.
While hearing the case, the high court also remarked
” that the matter was badly handled by the Congress party, and it appears that someone in the party office has been asleep since 2021″.
The Congress approached the Delhi High Court after the ITAT rejected its plea for a stay on tax recovery for the 2018–19 assessment year.
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Senior Advocate Vivek Tankha, representing Congress, brought the urgency of the matter to the bench headed by Acting Chief Justice Manmohan, which immediately allowed the case to be heard.
Tankha highlighted that the party’s accounts were frozen, and its stay application was dismissed by the ITAT. He emphasized the crucial electoral period and the party’s need for protection, which they believed the ITAT initially granted.
In February, the Congress had a dispute with the Income Tax Department before the 2024 Lok Sabha Elections. Congress Treasurer Ajay Maken revealed that the Income Tax Department had frozen four of its bank accounts, demanding Rs 210 crores related to the party’s income tax returns for 2018–19. Maken cited delays in submitting account details due by December 31, 2019, which the party missed by 40–45 days.
Subsequently, the Congress appealed to the ITAT to lift the freeze on its bank accounts and halt the IT Department’s actions.
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The ITAT recently dismissed Congress’ plea, asserting that its intervention wasn’t necessary at this stage.
After the initial ITAT hearing, Ajay Maken disclosed that the freeze on their bank accounts was lifted, subject to maintaining Rs 115 crore as a lien. However, the Congress party claimed it held significantly less than Rs 115 crore in its current accounts.
Furthermore, the Congress alleged that the IT Department initiated a recovery process by withdrawing Rs 65.8 crore from their bank accounts, decrying what they perceived as unjust targeting by the tax authorities and asserting that national parties are exempt from income tax payments.
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