AAP, Cong get I-T notices on funding

Dept wants replies on recent cheque payments by seemingly bogus firms; wants to know what was done to verify antecedents

The Aam Aadmi Party (AAP), after a landslide victory in the Delhi elections, was in the news on Wednesday for less-welcome reasons.

The income tax (I-T) department has issued a notice to the party, initiating an investigation into the funding controversy reported some days earlier.

The department stated it had issued notices on Monday to 50 individuals, including two political parties, in the matter of issuance of cheques by seemingly bogus companies, so used to convert illegitimate cash into ‘white’ or legal money.

The other party facing action is the Indian National Congress. Sources say the procedure being probed is similar.

The Central Board of Direct Taxes has sought a reply by the coming Monday, to ascertain whether the political party in question had a role in such conversions. These notices seek information on the contributors’ identity.

The funding row began after a volunteer party, AAVAM, had run an expose on Rs 2 crore of funds accepted by AAP. The group alleged four bogus companies made donations of Rs 50 lakh at the same time on the same date in 2014.

Sources indicate AAP has been asked to reply whether the party verified that the companies in question donated a maximum of seven and a half per cent of net profit for the preceding three financial years to them and if it had verified the directors and people behind the companies.

Reacting to the charges, the Union finance minister had written in his personal blog on ‘What would Arvind Kejriwal, IRS, have done?’ The reference is to AAP chief Kejriwal’s earlier role as an income tax officer, in the Indian Revenue Service.

“Surely, when a company donates lakhs and crores to a political party, the party would attempt to know as to who the controlling interest behind these companies are? The only fact that the donations have been made by cheque does not purify the transaction,” the blog stated.

AAP spokesperson Atishi Marlena welcomed the investigation by the I-T department and sought that funding of all political parties be looked at by a Special Investigative Team.

Motilal Vora, treasurer of the All India Congress Committee, said the party has got a notice over funding of Rs 10 lakh into its account. He said they’d reply and the cheque came with a covering letter.

Bharatiya Janata Party spokesperson Shahnawaz Hussain termed it a “routine I-T department” notice that has been sent to 50 other individuals and entities.

The statement from the department was that it had initiated an investigation into the  issuance of cheques by companies acting as entry operators to convert illegal cash into legitimate money.

“Recently in Kolkata, this investigation led to detection of substantial unaccounted income. In these cases, the unaccounted income was sought to be converted into legitimate money with the help of non-genuine companies,” went the statement.