The party alleged that it showed that the Narendra Modi dispensation was "insincere, insensitive and unconcerned" to what is happening in the country.
Congress leader Anand Sharma, however, steered clear of the observations on India in the U S State Department report on International Religious Freedom for the year 2014.
The India section of the report, which includes the UPA rule till May 26, says that in 2014, India witnessed religiously motivated killings, arrests, riots and coerced religious conversions and the police in some cases failed to respond effectively to communal violence.
Sharma dubbed Jaitley's remarks as "perverse and cynical" contending that there was a "plan to create division with the diabolical agenda of radical elements of the so called Hindutva forces to suppress dissent and intimidate those (who speak up)".
He was also critical of the Prime Minister's remarks on the issue. Sharma insisted that the Prime Minister needed to go beyond expressing regret over the communal incidents in the country.
Noting that communal conflicts are not a law and order issue, he said that "it is part of a larger agenda of suppression of voices".
He said government's response showed that it was "insincere, insensitive and unconcerned" to the happenings in the country in the wake of the Dadri lynching incident.
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