Editor's Pick | Congress gets partial relief after lien on bank accounts

The Congress on Friday said that all its bank accounts had been “frozen” by the Income Tax (I-T) department over a discrepancy in filing its 2018-19 tax returns, terming the action an “assault on democracy by the Narendra Modi government” in the run-up to the Lok Sabha election. The Income Tax Appellate Tribunal (ITAT) subsequently provided partial relief to the party by allowing it to operate its accounts after setting aside ₹115 crore in lien. “This means that ₹115 crore has been frozen. This amount is much more than we have in our current accounts,” Congress treasurer Ajay Maken said. According to ITAT’s Friday order, the Revenue department told the tribunal that it had not issued any orders “for freezing the transactions in the bank account(s), but only for a lien on the amount lying in the bank account(s) up to the outstanding tax demand”. In a post on X, Mr. Maken shared copies of the notices sent to bank branch managers holding them personally liable for ensuring the payment of the Congress’s dues, and asked, “Is this not attaching/seizing/freezing our accounts?” In all, 11 bank accounts were frozen, including two accounts of the Indian Youth Congress. Mr. Maken said the accounts were frozen due to an Income-Tax department demand of ₹210 crore for the assessment year 2018-19, and a dispute regarding cash receipts of ₹14.4 lakh given to the party by its MLAs and MPs as donations from their salaries. The party learnt of the I-T department’s action on Wednesday, when banks refused to honour cheque payments. “You all know that 2019 was an election year and the deadline to file returns was extended up to December 31, 2019. We were late in filing our returns only by 40 to 45 days,” Mr. Maken said. The Congress’s appeal to release the hold on its accounts will be heard by the ITAT on February 21, according to Rajya Sabha member and senior advocate Vivek Tankha, who appeared before the tax tribunal on behalf of the party. “The government hasn’t just frozen our accounts, but democracy has been frozen if the principal Opposition party’s account is frozen just weeks before the general elections. Will our country have a single party rule?” the Congress treasurer asked. Calling the I-T action “an assault on democracy”, Congress president Mallikarjun Kharge appealed to the judiciary to “save the multi-party system and protect India’s democracy”. An editorial in The Hindu called it a “politically loaded move”, which followed after the Supreme Court of India expanded on the link between money and politics in a verdict that held the secretive electoral bond scheme to be unconstitutional. “Stalling the bank account of the Opposition, regardless of the Income-Tax department’s allegations, cannot be viewed as routine law enforcement. Weaponisation of the law against political opponents of the ruling party has become a serious threat to India’s democracy,” the editorial said. The Hindu’s Editorials Brave new world: On the India-European Free Trade Association agreement and IPR Scuttling opposition: On Income-Tax department action against the Congress The Hindu’s Daily News Quiz The Schengen zone in Europe is known after Schengen, a small village. In which country this village is located? Luxembourg Cyprus Romania Kosovo To know the answer and to play the full quiz, click here. [logo] Editor's Pick 17 February 2024 [The Hindu logo] In the Editor's Pick newsletter, The Hindu explains why a story was important enough to be carried on the front page of today's edition of our newspaper. [Arrow]Open in browser [Mail icon]More newsletters Congress gets partial relief after lien on bank accounts The [Congress on Friday said that all its bank accounts had been “frozen” by the Income Tax (I-T) department]( over a discrepancy in filing its 2018-19 tax returns, terming the action an “assault on democracy by the Narendra Modi government” in the run-up to the Lok Sabha election. The Income Tax Appellate Tribunal (ITAT) subsequently provided partial relief to the party by allowing it to operate its accounts after setting aside ₹115 crore in lien. “This means that ₹115 crore has been frozen. This amount is much more than we have in our current accounts,” Congress treasurer Ajay Maken said. According to ITAT’s Friday order, the Revenue department told the tribunal that it had not issued any orders “for freezing the transactions in the bank account(s), but only for a lien on the amount lying in the bank account(s) up to the outstanding tax demand”. In a post on X, Mr. Maken shared copies of the notices sent to bank branch managers holding them personally liable for ensuring the payment of the Congress’s dues, and asked, “Is this not attaching/seizing/freezing our accounts?” In all, 11 bank accounts were frozen, including two accounts of the Indian Youth Congress. Mr. Maken said the accounts were frozen due to an Income-Tax department demand of ₹210 crore for the assessment year 2018-19, and a dispute regarding cash receipts of ₹14.4 lakh given to the party by its MLAs and MPs as donations from their salaries. The party learnt of the I-T department’s action on Wednesday, when banks refused to honour cheque payments. “You all know that 2019 was an election year and the deadline to file returns was extended up to December 31, 2019. We were late in filing our returns only by 40 to 45 days,” Mr. Maken said. The Congress’s appeal to release the hold on its accounts will be heard by the ITAT on February 21, according to Rajya Sabha member and senior advocate Vivek Tankha, who appeared before the tax tribunal on behalf of the party. “The government hasn’t just frozen our accounts, but democracy has been frozen if the principal Opposition party’s account is frozen just weeks before the general elections. Will our country have a single party rule?” the Congress treasurer asked. Calling the I-T action “an assault on democracy”, Congress president Mallikarjun Kharge appealed to the judiciary to “save the multi-party system and protect India’s democracy”. [An editorial in The Hindu called it a “politically loaded move”]( which followed after the Supreme Court of India expanded on the link between money and politics in a verdict that held the secretive electoral bond scheme to be unconstitutional. “Stalling the bank account of the Opposition, regardless of the Income-Tax department’s allegations, cannot be viewed as routine law enforcement. Weaponisation of the law against political opponents of the ruling party has become a serious threat to India’s democracy,” the editorial said. The Hindu’s Editorials [Arrow][Brave new world: On the India-European Free Trade Association agreement and IPR]( [Arrow][Scuttling opposition: On Income-Tax department action against the Congress]( The Hindu’s Daily News Quiz The Schengen zone in Europe is known after Schengen, a small village. In which country this village is located? - Luxembourg - Cyprus - Romania - Kosovo To know the answer and to play the full quiz, [click here](. 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