The Income Tax Department on Wednesday conducted a “survey” of the premises of the think tank Center for Policy Research (CPR); Oxfam India, a global non-profit organization; and the Independent and Public Spirited Media Foundation (IPSMF) which funds a range of digital media entities.
The action came on a day tax officials conducted nationwide “searches” at over 100 locations spread across states including Maharashtra, Madhya Pradesh, Chhattisgarh, Uttarakhand, Uttar Pradesh, Haryana, Gujarat, and Delhi.
A senior official said that the tax searches are being conducted as part of the crackdown against some registered unrecognized political parties.
“Some of these searches against political parties are linked to each other in the states and some of these searches are not related to each other. The official said that the tax officials are conducting searches at more than 100 places and further action and investigation will continue in the days to come.
Tax officials indicated that the “survey” could be linked to alleged irregularities in their funding.
According to the CPR website, it is “recognized by the Government of India as a not-for-profit society, and contributions to the Center are tax-exempt. CPR receives a grant from the Indian Council of Social Science Research (ICSSR) and is a science and Department of Technology (DST) accredited institution.CPR receives grants from various domestic and international sources, including foundations, corporate philanthropy, governments, and multilateral agencies.
Sources said that FCRA registration of CPR is still going on. The latest donors listed on its website are the Ford Foundation; Australian High Commission; Institute of Development Studies, UK.
Oxfam India, according to its website, is a member of the global confederation of 21 Oxfam across the world. The government registered Oxfam India as “a non-profit organization under section 8 of the Indian Companies Act, 2013”.
On the midnight of December 31, 2021, Oxfam India’s FCRA registration along with 5,932 other NGOs expired. Of these, 5,789 NGOs had not applied for renewal, home ministry sources said, with the remaining applications being rejected. A day after the MHA refused to renew Oxfam India’s registration, the organization had said the action would hamper its humanitarian work in states across the country. It applied for a review of the MHA’s decision, which, sources said, is still under process.
IPSMF, registered as a public charitable trust in Bengaluru in 2015, is funding several media organizations including Alt News, Swarajya, EPW, and The Wire. According to the IPSMF website, its donors include Azim Premji Philanthropic Initiatives Pvt Ltd, Rohini Nilekani Philanthropies, Kiran Mazumdar Shaw, and Piramal Enterprises Ltd.
The Income Tax Act empowers officers to enter any premises, such as residences, shops, factories, or offices of the assessee, for search and seizure operations. The surveys, which are conducted under section 133A of the Income Tax Act, take place only on business premises. Surveys start during normal business hours, while searches can be done at any time of the day.
During the survey, I-T officers look at documents such as books of accounts, bank accounts, cash, stocks, and non-valuable documents.
In May, the Election Commission of India removed 87 Registered Unrecognized Political Parties (RUPPs) that had received donations without statutory compliance, for an investigation into “serious financial unfairness”. It also directed the RUPP to ensure compliance with Sections 29A and 29C of the Representation of the People Act, 1951.
As of September 2021, there were 2796 RUPPs, an increase of over 300% since 2001. The Election Commission also said that an income tax exemption of Rs 445 crore was claimed by 199 RUPPs in 2018-19 and Rs 608 crore in 2019-20. 219 RUPPs while 66 RUPPS claimed income tax exemption without submitting contribution reports in Form 24A as mandated under Section 29C of the Act.
The Election Commission had sent a list of 2174 RUPPs who had not submitted a contribution report to the Revenue Department for taking all consequential action as per the RP Act 1951 read with the relevant provisions of the Income Tax Act, 1961.
The panel had said, “The Commission has evidence of serious financial improprieties, willful attempts to evade tax and other illegal financial activities against three specific Registered Unrecognized Political Parties (RUPPs) which have been tainted by the privileges available to them and public trust.”
In June, the Election Commission again “delisted” 111 RUPPs from the register as part of its “graded action” against parties that violated its rules.
Section 29A of the RP Act governs the registration of an association/body of individual citizens of India as a political party. Section 29C requires the declaration of donations received by political parties. Under the provision, the RUPP is required to submit a report in the format prescribed under the Election Conduct Rules, 1961 to obtain a 100% exemption from income tax as an incentive to participate in elections.