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Shri •.•.ielSv "'c I c-:Under SeC'-eu~r ...'Election COnil1ils3icn or India,Nirvacher Sed2:1, .4,--.eka Read,NEVv DELI-'I< l:CG~,

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Sep:,29,2014

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Sub: Guidelines on transparency and accountability in party funds andelection expenditure matter- regarding.

Ref: Your letter:-- c.76/,:>PEMS'jTransparency/2013 dated 29.8.2014

l' 3 -,~-=_~' '-2~,;' ..:~r:-:: ._ ~.-= ; _ d=.'j""'2S on trenspar:=r:cy and accountabilityDear;ng "lC. -: F:"= '.: -;- ,_:-,,\:~':: ..~",:_ .•',2.(:: :3~ed 29.8.201.:..i. issJec Oy' yourgooase'f, 'Ne ,,:[::-e:I,,:,:: :re e:ror: of r;0~':; t: E!'::c::on Comm:ssioner of India toimpJemerlL :l'..:c .... -12eG~: ::-cnsoerE:r.:v ana 3~CDu1tab;iit{ in respect oT funosreceivea oy pc 1:,(0 ~J'''.,'_S, ~: ,S 0,50 "'p[::rec "teo :na: thE guidar,ce r.ote oracccLntir:g 3r.~ 3..:::'- no; C/' '00 itica Jerties (ssueJ b'{ :he Institute of CnarterecAccountel"ts ::f Indle 'l6, 3,50 Deer. maOE mand3:0r, fc-r eli f=:cIitieal pr"ti'::s ',\thier:will surEly bri:-.; .n, "1.'"',1;--) l.' .3CCO.;" :ing amor.gst ali POlitical palTiEs,

H:WEver, :ei"C.: - '::'.I,:-n.'aliEs and conflict v.'i:r ::hE j'elatee statute h2\'E beenobserveD in liE' se'c ;di::e' !'""jes. T'lese corflicts cr-e nccice.: \'!ith respect to tr,eprovisc :Jr I'-I: .. 2 :~, /J<:. " i.:~ere rligillighted oe!c.\',':-

Section 13A of the Income Tax Act specifically mentions specialprovision relatin9 to income of political party. This section read asunder:-

"Any income or cJ political party which is chargeable under the head"Income fr(1tn house property" or "Income from other sources" or"Capital gams' or any income by way of voluntary contributionsrecp,i'!ed 0'/ a .1:;J'~i~a.'partj' from any person shall not be included inthe tot~ I 'w:r.m,:, C" the previous vear of such political party:

Provided that - •(a) Such pofitical party keeps and maintains such books of account

and other documents as \Yould enable the Assessing Officer toproperly deduce its income therefromi

(b) III respect of each such voluntary contribution in excess oft~';et7ty thousand rupees, such political party keeps andmaintains a record of such contribution and the name and2::'jre,,_ ~(rile pe,-::;cf) "ho has made such contributioni and

(c) T'Je "C'.:o~Hi:; cf slich political party are audited by anaccountant as defined in the Explanation below sub-section(2) of ';c.:ciic!i 28'3:

Provided f~,~fhp.r that if the treasurer of such political party or anyother P"'-:;0r' 'Jr,"rn67°rf by that political party in this behalf fails tosubmit i3 r?port under sub-section (3) of section 29C of theRepreS(2'ltath''l n' 'he People Act, 1951 (43 of 1951) for a financialyear, no exemption U"7der this section shall be available for thatpolitical pa-ty 'n" 'Suchfinaf)cial year.

Explar;aric'7 . 1=arrl"e pL"rposes of this section, "political party" meansa politic?1 !l?'rt'l r'?qistered L'nder section 29A of the RepresentationofthePenplo4rr 1.51(430<1951)."

'-;O\'. e .....:.refer"nc," c' :)~_, _these sec~0 .t~:relevent sec- -.-incorne Of ;:"c. .. t i •••• -y .:

:..:;1- _.: 25 ;;Svcj J'" \ie_I" ~00cse f makes a_ ~ '_ ,,:oc. rlS "Tey ",no , :e aDJreciated :ha:

_ , _,' ".:i"ty '''steao :hev cp;)I" :0 tre doror. The- .....~..- s-re-:i-=--::: IV r"':)\i~'''',;; ro- :'le ;--e3trnent ofi -:p ;! ~ !r'(r me le':-' ,';,-::,

It ISa SL"c~been duly:)':,' ':'; ,conson" nce ,,",'-provis!o'l:, r- '" -: -, .Sec:io'O 13/>, '-,:- • ,-whicr politic'- 0 "t

,i.C1i_ c , 13t ell, gL.,::eline cannet evel'ride the act wnleh has••• t-., C,.l- ,.-...•.'): T,oia T~Erc.::)-EI t:---.i5 g,.Jideline is not in'.,' - =, _' rr,; ''leon-e -ax ..;c crj tner::oy violate tile

- ','- "T_ C .,' 3Y ~;so be 2PP;'~cjaLec thet tl~E: orovisior-,S Ir.-t, ':: ":;:::JlfVJIn [Tir"'d :he SITtal1 00na'~'()ns or contribL;tions

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" :: r i:! I oi'etiofl LA vi.je Proviso (b) cle2rly.t ....~l ",;;r-t, sh Jld Keeo and nlaintain ~ reccrc of each such

.. 0:' (t',s . I t<s.20,OOOI- -eCeiVf'G 'rom any person••• -~t -= :: .,f t !~7.p~rson who n2V~ Made SlJCl contribution.

-.iX i',t, J CJG1 'Jeany al,ov,s ell polie,eel parties not to~ .". 'ltdI', cont"iou:ions received .•..'here the

,~ i,lan R5.20.000i-. Especi211yin the case of our.- P \ -:<f';r se::(i(.r cf s:..:'!ety ana are very

Vo, "{provides t'lat- "1-" -voluntary CO'lUiCI;,includ'r'g thE=: r"'~'~.

By this Provisn Ty"r"maintain ;~'r \, :1,. t:contribution ~.'- ,pa rty \V hos, "

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MOTILAL VOR.l' r p7REASURER

To

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Shri Mallya Malik,Secre:ar I

Election (0"1'111>; on cline at'iir\'acha"1 Sada ~.,,', Je hi

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S.le' Gu,oeilnes Oil uars>.Jcreney a'1d accountability r party (,mds andelection expenoitul e mattE" dated 7'1:' :,ugust, 201-1 " regardll1g,

Dear Sir,

Kindl\' re'er to our earlie letter dateG 22" Scptcmoer, 2014 regardingtne guidelhes ::roposed :0 be issued by tbe Electio'" (O["'1m sson of Ind'a 0'1:ne afo"err,e-,ticr,eG s"i:ject -vherein its legal:', ana constlhJtlonality ~as alsobeer. q,d?stione:o F~I.the' -0 corsultation ",as been done wi:h the pol,icaponies .Jefore .ssue 0: s....C'.. gUldelllles. The 5sue Ir"l\ 01\ es a the rEcog': zedpoll:i:al p"r: es and be'c'e "-'I such guideline, arE: ss~eo hi the Comm ssion't r",ay ::Je necessar\ to ha\e oint n-,eeting of 21 tre PO 'tIcal parties on tresubject and also the ma;::er needs to be 'E:re'red !O :he i',' nistry of LaN andJustice for taking appropriatE: actio"

It " thereiore, requEsted that before giving effECt to :he Guide ines tne(on!nlssio, may be pleasec: to ho d a meetl1g of thE a I the political partiesor the SUbJEeL2no alsc refEr the lliitter to ~he f\'1il1'5t,)' of _aw and Justice fortaking appropriate acroll as pe' law.

YCli "rE I ;,erercre IEcuested ,lccordingh,

With regardsYours sincerely,\

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(Metilal Vera)

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