The Election Commission of India (EC) wants to delist 200-odd political parties in the country that have been dormant and not contested elections in years. The EC is also going to send the Central Board of Direct Taxes (CBDT) a list of the delisted parties.
According to a report in the Indian Express, the EC suspects that these parties have not contested polls since 2005 and have been used for laundering money.
The move by the EC comes in the wake of the recent government crackdown on unaccounted cash or so called 'black money'.
A source told the Indian Express that the proposed delisting was to be undertaken in the hope that CBDT will act against these parties, sending out the message that unaccounted cash cannot be laundered via such political parties.
Earlier this week, Prime Minister Narendra Modi urged the EC to ensure that political parties were transparent about financial donations they receive.
"I urged all leaders that the country expects honesty. There is mistrust against political parties. So it is our responsibility to make people believe in our honesty," IANS had quoted the prime minister as saying.
"I urge the EC to take it forward, create pressure on parties... Our government will implement whatever decision is in favour of the nation," Modi had said.
On the other hand though, the government also announced some days ago that deposition of old notes by political parties in bank accounts would not attract any scrutiny by tax authorities.
Under Section 13A of the IT Act, 1961, political parties have to submit audited accounts, income and expenditure details and balance sheets, and they are exempt from taxes if the donations are not over ₹20,000.
Commenting on political parties depositing old notes in banks, Revenue Secretary Hasmukh Adhia had said earlier this week, "See, if it is a deposit in the account of political parties, they are exempt. But if it is deposited in any individual account, in anyone's account, that information will definitely come on our radar."