NEW DELHI: The Supreme Court on Wednesday dismissed a plea seeking to bring political parties within Income Tax net, saying that there is no illegality in granting an exemption to them.
The court was hearing a plea filed by advocate Manohar Lal Sharma seeking not to provide any tax relief to political parties.The petition has asked the apex court to decide on why ordinary persons are taxed while political parties enjoy exemption from tax.
However, refusing to entertain the plea, the bench said, "Political parties need public fund to project their ideologies and there is no wrong with the policy to exempt them under IT Act."
"It's an executive action and doesn't violate the constitution," the bench observed.
The petitioner has sought the quashing of the 13(a) of the Income Tax Act which confers tax exemption to the political parties for income from house property, income by way of voluntary contributions, income from capital gains and other sources.
In his petition, Sharma has also challenged the constitutional validity of the Representation of People's Act that provides for the actual conduct of elections in the country. The act also deals with details like qualification and disqualification of members of both houses of Parliament and the state.