Corporate funding for political parties has been much in discussion, especially in the wake of calls for more transparency from various quarters.
Industry body Assocham's Secretary General D S Rawat said there should be transparency and corporates should show how much has been given to political parties and to whom.
"We completely support the provisions in the Companies Act (with regard to funding for political parties", he told PTI.
Noting that companies are accountable to shareholders, he said that unless disclosures about funding are made, there is possibility of corruption.
Under the Companies Act, 2013, corporates are required to disclose in their profit and loss account contributions made to political parties. They also have to furnish particulars of the total amount contributed as well as name of the party to which it is given.
However, the Confederation of Indian Industry (CII) has made a representation to the government seeking changes in this provision.
In this regard, CII has made a representation to the Corporate Affairs Ministry which is implementing the Companies Act.
CII Director-General Chandrajit Banerjee did not respond to queries on the same. Industry bodies Ficci and PHD Chamber also did not respond to queries.
Meanwhile, under the Companies Act, corporates that violate the provisions related to providing funds for political parties could face strict punishments including penalties.
Earlier this year, the government notified Electoral Trusts Scheme to ensure more transparency in the funds provided by corporate entities to the political parties for their election-related expenses.
As per the scheme, such companies can get tax benefits only if they distribute 95 per cent of total contributions received by them in any financial year to the registered political parties within that year itself.
Besides, they can not receive any contribution in cash and they are required to take the Permanent Account Number of all contributors who are resident Indians, and passport number of non-resident Indian citizens at the time of receiving the contribution.
These Electoral Trust companies are not allowed to accept contributions from foreign citizens or companies.