Big relief to Congress: I-T dept tells SC no coercive action in view of LS polls

Responding to a plea by the Congress against tax demand notices of approximately Rs 3,500 crore, the Income Tax department on Monday (April 1) told the Supreme Court that it would not take any coercive action against the Congress over the tax demand in view of the Lok Sabha elections.

A bench of Justices BV Nagarathna and Augustine George Masih recorded the statement of Solicitor General Tushar Mehta, representing the I-T department, that the department will not take any precipitative action in the prevailing circumstances till the final adjudication of the matter.

The bench posted the Congress' plea against the tax demand notices for July.

No coercive action

At the outset, SG Mehta said, "I want to make a statement in this matter. The Congress is a political party and since elections are going on, we are not going to take any coercive action against the party." The department is not commenting on the merit of the matter and all rights and contentions should be left open, he said.

"They were given an option to pay 20 per cent in 2024, ₹ 135 crore (was) recovered. ₹ 1,700 crore demand has been raised later. Therefore, the matter pertains to ₹ 1,700 subsequently raised. This whole matter can be fixed for post elections. We will not take any action till then," the Solicitor General assured the court.

A ‘gracious’ gesture

Senior advocate Abhishek Singhvi, appearing for the Congress, appreciated the gesture, terming it "gracious", and said all demand notices were issued in March and before for different years totalling approximately Rs 3,500 crore.

The Congress on Sunday (April 1) said it has received fresh notices from the Income Tax Department, raising a tax demand of Rs 1,745 crore for the assessment years 2014-15 to 2016-17. With this latest notice, the Income Tax Department has raised a total demand of Rs 3,567 crore from the party, it had said.

‘Tax terrorism’

The grand old party on Friday (March 29) said it received notices from the I-T department asking it to pay around Rs 1,823 crore. The tax authorities have already withdrawn Rs 135 crore from the party's accounts for a tax demand relating to previous years.

The party had approached the top court after it received demand notices amounting to over Rs. 3,567 crore for alleged dues going back in decades. Calling the demand and unilateral action by the Income Tax department “tax terrorism”, the Congress has alleged that the BJP-led Centre is choking the party financially in election time.

(With agency inputs)