Gujarat CID Probes Rs 680 Crore Political Donation Scam Involving Four Parties

The Gujarat CID Crime has launched an investigation into four cases involving registered unrecognised political parties (RUPPs), which allegedly caused a Rs 680 crore loss to the government exchequer through a fraudulent political donation scheme.

The cases were registered over the past three days based on complaints filed by the Income Tax Department, Rohan Anand, Superintendent of Police of the Anti-Economic Offences Wing, said on Monday.

According to the CID, Income Tax raids conducted around 2022-23 allegedly found that certain individuals had formed political parties to collect donations and enable taxpayers to claim income tax benefits without genuine political activity.

The parties allegedly accepted donations in their bank accounts and subsequently withdrew the money against bogus purchases and expenses supported by fake bills. After deducting commissions, the remaining amount was allegedly returned to donors in cash through the angadia network, the complaints stated.

As political donations are eligible for tax benefits subject to applicable provisions, donors allegedly used receipts issued by the parties to claim rebates, resulting in revenue loss to the government. “Preliminary findings indicate a loss of Rs 680 crore to the government exchequer in these four cases,” Anand said, adding that the investigation was underway.

The CID is collecting bank transaction trails, angadia slips and party payment receipts as part of the probe. Officials are also attempting to trace individuals who have allegedly gone absconding. The FIRs name the Swatantrata Abhivyakti Party (SAP), Ahmedabad-based Satyavadi Rakshak Party (SRP), Garib Kalyan Party (GKP) and another RUPP whose name was not immediately available.

Office-bearers of the parties and several chartered accountants have also been named as accused. The FIRs allege that the parties submitted false contribution reports to the Election Commission, while accused chartered accountants allegedly prepared bogus audit reports for the entities and certain shell companies.

The CID will also conduct a forensic examination of audit reports available on the Election Commission of India portal.