New Delhi: A plea has been filed in the Supreme Court seeking a direction to the Central government to take steps to restrict political donation in cash to Rs2,000 per person per year.

The public interest litigation (PIL), brought by Bharatiya Janata Party (BJP) spokesperson Ashwini Kumar Upadhyay, also seeks exemption of income tax for political parties that contest election and win seats in Parliament or legislative assemblies, in line with the recommendations of the Election Commission of India (EC).

The PIL, which is yet to come up for hearing, has called for a direction to the EC to deregister political parties that do not contest elections. It has also called for deregistering parties that accept cash donation in excess of Rs2,000 per person per year, or accept total donations of either more than Rs10 crore or more than 10% of total donation in cash, whichever is less.

The PIL highlights the importance of Section 29C of the Representation of (the) People Act, 1951 stating that the treasurer of a political party or an authorised person shall prepare a report in each financial year declaring donations received in that year. This report must be submitted before the due date for furnishing a return of its income of that financial year under provisions of the I-T Act.

There are many cases where political parties are formed merely for availing benefits of income tax exemption. Therefore, provisions for exemption of income tax should be made applicable only to those political parties that contest elections and win seats in Parliament or legislative assemblies, the petition states.

The PIL states that political parties are major stakeholders of our democracy must be accountable to the public. It says that restrictions in cash donation will ensure transparency and empower the people to make informed decisions while electing their representatives.

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