The Aam Aadmi Party (AAP) has been charged by the Income Tax Department for taking “hawala entries” worth Rs 2 crore from a Delhi-based operative and revoked the tax exemption given to it as a political party for the assessment year 2015-16. The taxman in the penalty notice said that the AAP “incorrectly disclosed the hawala money as voluntary donations”. In its assessment order issued to the party last week, the Income Tax department charged the Arvind Kejriwal-led-party and announced that the total taxable income of AAP was at Rs 68.44 crore with an income tax of Rs 30.67 crore for the year 2015-16.
The order came with the penalty notice (under section 271 [c]) for allegedly concealing its correct income. The party has been charged by the department with not correctly showing the political donations received by it as stipulated under the Representation of the People (RP) Act.
The notice issued by the I-T department stated, “The AAP party had taken hawala entries of Rs 2 crore during the financial year 2014-15 from a hawala entry operator of Delhi and the same was incorrectly disclosed as voluntary donations.”
It added the taxman’s probe had found the said hawala operative provided such illegal entries to 372 other entities/persons. Hawala is the criminal act of skirting legal banking channels to move funds and thereby evade tax.
In response to the I-T department’s notice, Delhi chief minister Arvind Kejriwal called the action the “height of political vendetta”. “In the history of India, all donations to a political party have been declared illegal. All these were accounted for and shown in books of accounts. This is the height of political vendetta,” he tweeted.
In the history of India, ALL donations to a political party have been declared illegal. All these were accounted for and shown in books of accounts. This is height of political vendetta
— Arvind Kejriwal (@ArvindKejriwal) November 27, 2017
The AAP has been accused of not recording “donations of Rs 13.16 crore in its books of accounts and in the audited income and expenditure account filed along with the return of income for FY 2014-15”.
“The names and addresses of the donors contributing Rs 13.16 crore were not disclosed,” the tax notice alleged. PTI reported that department also charged AAP with “not recording the full details of names and addresses of 461 donors (each donation exceeding Rs 20,000) who had allegedly donated (a total of) Rs 6.26 crore, in its audited books of account and its contribution report filed to the Election Commission (EC).”