ECI awaits Law Ministry nod to deregister inactive parties

It raises concern over possible misuse of I-T exemption by those that don’t contest elections

The Election Commission on September 23 notified the updated list of registered political parties that included 2,796 registered unrecognised parties, at a time it has sought the power to deregister inactive parties.

The EC has raised concern over the possible misuse of the income tax exemption by parties that don’t contest elections. Senior EC sources said on Saturday the Law Ministry was yet to respond to the EC’s recent proposal seeking the power to deregister inactive parties. A senior official said only 673 parties, including recognised and unrecognised, had participated in the 2019 Lok Sabha elections. In March 2019, the list of registered unrecognised parties had 2,293 names.

Another senior official said the EC had raised the concern that the Income Tax exemption on donations given to registered parties under Section 13 A of the Income-tax Act could be misused by some. The official said not only was the proposal sent to the Law Ministry, the matter was also brought to the notice of the Central Board of Direct Taxes.

Among the concerns was that some of the registered parties may be collecting donations and using them for other purposes, functioning as shell entities and money laundering, the official said. The official said the EC had proposed de-registering such parties that don’t contest two consecutive elections, Parliamentary or Assembly.

While the EC has the power to register parties under the Representation of the People Act, 1951, it does not have the power to deregister parties that are inactive.

On the latest list of parties are eight national recognised parties — the All-India Trinamool Congress, the Bahujan Samaj Party, the BJP, the CPI, the CPI(M), the INC, the NCP and the National People’s Party, which is the latest addition, and 54 recognised State parties, some of which are recognised in multiple States.

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