New Delhi, Aug 27: The Supreme Court is scheduled to hear on August 31 a petition challenging the validity of a provision in the Income Tax Act that permits political parties to accept cash donations of less than Rs 2,000.
According to the court’s cause list, the matter will be heard by a bench comprising Justices Vikram Nath and Sandeep Mehta.
The petition, filed by Khem Singh Bhati, challenges Section 13A(d) of the Income Tax Act, 1961, arguing that allowing anonymous cash contributions below Rs 2,000 undermines transparency in political funding and affects voters’ right to information.
The petitioner has sought a direction to the Election Commission to make it a condition for registration of political parties and allotment of election symbols that no political party accept donations in cash.
The Supreme Court had agreed to examine the plea on November 24 last year and sought responses from the Centre and other parties.
The petition contends that voters should have access to information about political donors and the sources of funding to enable them to make informed decisions during elections.
It has also sought directions to the Election Commission to scrutinise Form 24A contribution reports submitted by recognised political parties and ensure that contributions lacking details such as the donor’s address or PAN are properly dealt with.
The petitioner has further sought action against political parties that fail to submit complete contribution reports, including proceedings under the Election Symbols (Reservation and Allotment) Order, 1968.
A direction has also been sought to the Central Board of Direct Taxes (CBDT) to examine income-tax returns and audit reports filed by political parties over the past five years and initiate appropriate tax, penalty or prosecution proceedings wherever violations are found.
The plea argues that permitting anonymous cash donations below Rs 2,000 violates voters’ fundamental right to information under Article 19(1)(a) of the Constitution.
It has also cited the Supreme Court’s 2024 judgment striking down the electoral bonds scheme, which had been introduced in 2018 as an alternative to cash donations to political parties with the stated objective of improving transparency in political funding.
