I-T department raised tax demand in 2021 but you did not act, Delhi High Court tells Congress

March 12, 2024 09:41 pm | Updated 09:41 pm IST - NEW DELHI

The Delhi High Court on Tuesday reserved its judgment on the Congress’s plea challenging an order of the Income Tax Appellate Tribunal (ITAT) that refused to stay a notice issued by the Income Tax department for recovery of outstanding dues of more than ₹100 crore.

Senior advocate Vivek Tankha, representing the Congress, said the notification for the Lok Sabha election is expected in the next few days and the party is under tremendous pressure as its bank accounts had been frozen. He urged the court to grant the national party some protection.

‘Balanced view’

The High Court, however, told the Congress’s counsel that though the tax demand was raised by the I-T department in 2021, the party took no steps to address the issue. The High Court said it was a “badly handled matter” and somebody from the Congress office “went off to sleep” right from 2021.

“Merely because someone chose to wake up and put you on notice in February will not change those facts,” the High Court said, adding the appellate tribunal has taken a balanced and plausible view.

The Congress approached the High Court after the ITAT on March 8 dismissed the party’s application seeking a stay on the February 13 notice of the IT department initiating recovery proceedings against it.

The assessing officer had raised a tax demand of more than ₹100 crore for the assessment year 2018-19 when the income was assessed to be more than ₹199 crore.

The I-T department’s counsel submitted that though the Congress was given the option of paying 20 per cent of the demand way back in 2021, it was not done. If the assessee does not avail the facility of depositing 20 per cent of the demand when offered, the entire amount becomes recoverable, the counsel said.

“It is a routine process. It has nothing to do with the elections,” the counsel said.

The I-T department’s counsel said the original tax demand stood at ₹102 crore and with interest it became ₹135.06 crore. He said ₹65.94 crore stands recovered now.