National Herald Case: Rahul, Sonia’s Tax Records to Be Scrutinised
Congress President Rahul Gandhi and Sonia Gandhi on Monday, 10 September failed to get any relief from the Delhi High Court which dismissed their challenge on reopening of their tax assessments for the year 2011-12.
The rejection of the pleas of the top Congress leaders, including Oscar Fernandes, will pave the way for the Income Tax Department to scrutinise their records for the assessment year 2011-12.
"...the assessees' rights to urge them are reserved in the income tax proceedings," it said, while "dismissing" the three separate petitions which were decided through a common order.
The income tax probe against the Congress leaders has arisen from the investigation into the private criminal complaint filed by Bharatiya Janata Party (BJP) leader Subramanian Swamy before a trial court in connection with the National Herald case.
A tax evasion petition (TEP) was also addressed to the finance minister by Swamy.
Sonia, Rahul and others have been accused of conspiring to cheat and misappropriate funds by paying just Rs 50 lakh, through which Young Indian (YI), the not-for-profit organisation, had obtained the right to recover Rs 90.25 crore that the Associated Journals Ltd (AJL) owed to the Congress party.
It was alleged that YI, which was incorporated in November 2010 with a capital of Rs 50 lakh, had acquired almost all shareholdings of the AJL, which was running the National Herald newspaper.
In this process, YI had also acquired AJL's debt of Rs 90 crore.
It has already issued a demand notice for Rs 249.15 crore to YI for the assessment year 2011-12.
The department's move followed its probe on a complaint alleging that the Gandhis had misappropriated AJL's assets while transferring their shares to the newly formed YI.
The bench, in its Monday order, noted that the premise of the reassessment notices was that the non-disclosure of the taxing event - allotment of shares of YI - deprived the assessing officer of the opportunity to look into the records.
It said that in Rahul's case, the non-disclosure of share acquisition constituted tangible material justifying reassessment.
In case of Sonia and Oscar, the bench said returns filed by them were processed under Section 143(1) of the Income Tax Act, which pertains to 'Notice or intimation', and are not treated as "assessments".