What Does the Kerala HC's Decision Mean for CPI(M) After IT Dept’s Rs 1 Crore Seizure?
Click to start listening
Synopsis
The Kerala High Court's recent ruling not to intervene in the Income Tax Department's seizure of Rs 1 crore from CPI(M)'s account raises significant questions about the party's financial transparency and the implications for upcoming elections. This decision highlights ongoing tensions between political parties and regulatory authorities in India.
Key Takeaways
- Kerala High Court upholds IT Department's seizure.
- Account frozen due to financial discrepancies.
- Former CPI(M) district secretary challenged the seizure.
- Prima facie evidence of undisclosed account found.
- CPI(M) faces increased scrutiny ahead of elections.
Kochi, May 2 (NationPress) In a blow to the ruling CPI(M), the Kerala High Court on Friday chose not to intervene in the Income Tax Department’s seizure of Rs 1 crore from the party’s Thrissur District Committee account at the Bank of India’s Thrissur branch.
The seizure occurred on April 30, 2024, when funds were being deposited back into an account that had previously been frozen by the IT department.
The account was frozen due to discrepancies between the party’s submitted annual returns and the actual details of the account.
The former district secretary of the party, M. M. Varghese, contested the department’s actions in court.
However, the High Court ruled that the evidence presented did not indicate any malicious intent by the authorities.
“The pleadings and the materials placed for consideration do not indicate any malafides... Hence, the satisfaction arrived at by the respondents to initiate the search and seizure under Section 132 of the Income Tax Act cannot be held to be perverse or legally untenable. Considering the scope of interference under Article 226 with a proceeding under Section 132 of the Act, this Court is of the view that the search and seizure proceedings initiated by the respondents do not warrant any interference at this juncture,” stated the Court.
The Court also highlighted that there was prima facie evidence suggesting the bank account was not reported in the party’s returns.
On the day of the seizure, Varghese reportedly informed IT officials that he intended to deposit the remaining funds from previous withdrawals, but was required to provide documentation regarding the source of the money.
Earlier, during the first week of April—just before the Lok Sabha elections—the IT department had frozen the CPI(M)’s Thrissur district account, citing its absence from the party’s annual returns.
Reports suggest that the account originally contained approximately Rs 4.8 crore, of which Rs 1 crore was withdrawn prior to the freeze.
Point of View
It's crucial to acknowledge the complexities surrounding the recent High Court ruling. This decision reveals significant issues related to financial compliance within political parties. It emphasizes the necessity for transparency and adherence to regulations, especially in the lead-up to elections. The ongoing scrutiny from the IT Department serves as a reminder that accountability is essential in democratic processes.
NationPress
23/06/2025
Frequently Asked Questions
Why was the CPI(M) account seized?
The account was seized due to discrepancies between the party's annual returns and actual account details, leading to suspicions of financial mismanagement.
What did the Kerala High Court decide?
The Kerala High Court decided not to interfere with the Income Tax Department's seizure, stating that there was no evidence of malafide intent from the authorities.
What is the significance of this ruling?
This ruling could have major implications for the CPI(M) as it raises questions about financial transparency and could affect public perception ahead of elections.
