Supreme Court to hear plea challenging anonymous political donations

NEW DELHI: The Supreme Court is scheduled to hear a plea on Monday challenging the validity of a provision of the Income Tax Act that allows political parties to receive anonymous cash donations of less than Rs 2,000. A bench of Justices Vikram Nath and Sandeep Mehta is likely to hear the matter.

The petitioner, Khem Singh Bhati, has argued that anonymous cash donations undermine transparency in elections by denying voters information about the source of political funding and the motives of donors. The plea has sought the striking down of Clause (d) of Section 13A of the Income Tax Act, 1961, as unconstitutional.

"The petitioner is seeking direction that the political parties must disclose the name and all other particulars of the person paying any amount of money to it, and no amount can be received in cash so as to maintain transparency in the political funding," the plea, filed said. The petitioner has referred to the Supreme Court's 2024 verdict striking down the electoral bonds scheme, arguing that political funding must remain transparent.

Plea seeks EC, CBDT scrutiny of party finances The plea has sought directions to the Election Commission to scrutinise Form 24A contribution reports of recognised political parties and take action against parties that fail to provide complete donor details, including addresses and PAN information.

It has also sought independent audits of political party accounts and action under the Election Symbols Order, 1968, against defaulting parties.

The petitioner has further urged the Central Board of Direct Taxes (CBDT) to scrutinise the income tax returns and audit reports of political parties for the past five years and initiate tax, penalty or prosecution proceedings for violations of Section 13A of the Income Tax Act read with Section 29C of the Representation of the People Act.