Deposits in bank accounts of political parties exempt from scrutiny under IT law

Finance Secretary Ashok Lavasa.

Finance Secretary Ashok Lavasa on Friday said that political parties are exempted under Income Tax law to deposit old currency notes in their bank accounts. The decision effectively means that political parties will not come under any scrutiny for cash deposits in old currency notes into their accounts. “Tax exemption on deposits by political parties subject to individual donations not exceeding Rs 20,000 in cash and with proper receipt,” Lavasa told reporters on Friday.

Earlier today, Lavasa also said the cap imposed on withdrawal from bank accounts post demonetisation will be reviewed after December 30, the last date for depositing of old currency notes with the banks. The government has fixed a limit of Rs 24,000 per week on withdrawal from bank accounts and Rs 2,500 per day from ATMs in view of the currency crunch following scrapping of 500 and 1,000 rupee notes.

“There will be a review which will be done after December 30 and whatever steps are required to be taken to bring things back to normalcy, I think they will be decided only after the review is complete,” Finance Secretary Ashok Lavasa said at a Ficci event here.

(With PTI inputs)