PAN Current Affairs - 2019
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In an affidavit filed before the Supreme Court, the Election Commission of India has made the following observations:
- Electoral bonds, contrary to government claims, wreck transparency in political funding.
- Electoral bonds coupled with the removal of the cap on foreign funding invites foreign corporate powers to impact Indian politics.
- Electoral bonds would cause a “serious impact” on transparency in the funding of political parties.
The Election Commission of India further criticises amendments made to various key statutes through the two consecutive Finance Acts of 2016 and 2017.
What were the amendments made?
The Finance Act of 2017 amends various laws, including the Representation of the People Act of 1951, the Income Tax Act and the Companies Act. The Finance Act of 2016 makes changes in the Foreign Contribution (Regulation) Act of 2010.
The amendment to Representation of the People Act allows political parties to skip recording donations received by them through electoral bonds in their contribution reports to the ECI.
The amendments introduced to the Income Tax Act allow anonymous donations. Donors to political parties are not required to provide their names, address or PAN if they have contributed less than Rs. 20,000. The Election Commission notes that many political parties have been reporting a major portion of the donations received as being less than the prescribed limit of Rs. 20,000.
The Finance Act of 2016 allowed donations to be received from foreign companies having a majority stake in Indian companies.
Observations by Election Commission
The Election Commission of India called these measures as a retrograde step and the ECI has no way to ascertain whether the donations were received illegally by the political party from government companies or foreign sources.
The Election commission also expressed concerns that these amendments would pump in black money for political funding through shell companies and allow unchecked foreign funding of political parties in India which could lead to Indian politics being influenced by foreign companies.
Tags: Black Money • Companies Act • ECI • Election Commission of India • Electoral bonds • Finance Act 2016 • Finance Act 2017 • Foreign Contribution (Regulation) Act 2010. • Income Tax Act • PAN • Political Funding • Representation of the People Act 1951 • Shell Companies • Supreme Court
The Supreme Court has upheld the section 139AA of the Income Tax Act and said that linking of PAN with Aadhaar is mandatory for the filing of Income Tax returns.
The Supreme Court made these observations while hearing an appeal filed by the Centre against a Delhi High Court order allowing two people, Shreya Sen and Jayshree Satpute, to file Income Tax returns for 2018-19 without linking their Aadhaar and PAN numbers.
Noting that with regard to Assessment Year 2018-19 the two petitioners had filed the Income Tax returns in terms of the orders of the High Court and the assessment has also been completed, Supreme Court said that for the assessment year 2019-20, the income tax return shall be filed in terms of the judgment passed by this court.
Section 139AA of the Income-tax Act
Section 139AA of the Income-Tax Act 1961 was introduced by the Finance Act, 2017. The section makes it mandatory to quote Aadhaar / Enrolment ID of Aadhaar application form, for the filing of return of income as well as in the application form to enrol for PAN.
The section also specifies that those already in possession of the PAN numbers must mandatorily link their PAN numbers with Aadhaar. Failure to do so would result in PAN number becoming invalid.