Section 13A of Income Tax Act for AY 2023-24

Incomes of political parties.. Notes on section 13A of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962.

Amended and updated notes on section 13A of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to special provision relating to incomes of political parties.

Chapter III (Sections 10 to 13B) of the Income Tax Act 1961 deals with the provisions related to incomes which do not form part of total income. Section 13A of IT Act 1961-2023 provides for special provision relating to incomes of political parties.

Recently, we have discussed in detail section 13 (section 11 not to apply in certain cases) of IT Act 1961. Today, we learn the provisions of section 13A of Income-tax Act 1961. The amended provision of section 13A is effective for financial year 2022-23 relevant to the assessment year 2023-24.

In this article, you will learn detail of the provisions of section 13A of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962 as provided by Ministry of Law and Justice, Government of India.

Section-13A: Special provision relating to incomes of political parties

Any income of a political party which is chargeable under the head “Income from house property” or “Income from other sources” or “Capital gains” or any income by way of voluntary contributions received by a political party from any person shall not be included in the total income of the previous year of such political party :

Provided that—

  • (a) such political party keeps and maintains such books of account and other documents as would enable the Assessing Officer to properly deduce its income therefrom;
  • (b) in respect of each such voluntary contribution other than contribution by way of electoral bond in excess of twenty thousand rupees, such political party keeps and maintains a record of such contribution and the name and address of the person who has made such contribution;
  • (c) the accounts of such political party are audited by an accountant as defined in the Explanation below sub-section (2) of section 288; and
  • (d) no donation exceeding two thousand rupees is received by such political party otherwise than by an account payee cheque drawn on a bank or an account payee bank draft or use of electronic clearing system through a bank account 52[or through such other electronic mode as may be prescribed] or through electoral bond.

Explanation: For the purposes of this proviso, “electoral bond” means a bond referred to in the Explanation to sub-section (3) of section 31 of the Reserve Bank of India Act, 1934 (2 of 1934):

Provided further that if the treasurer of such political party or any other person authorised by that political party in this behalf fails to submit a report under sub-section (3) of section 29C of the Representation of the People Act, 1951 (43 of 1951) for a financial year, no exemption under this section shall be available for that political party for such financial year:

Provided also that such political party furnishes a return of income for the previous year in accordance with the provisions of sub-section (4B) of section 139 on or before the due date under that section.

Explanation: For the purposes of this section, “political party” means a political party registered under section 29A of the Representation of the People Act, 1951 (43 of 1951).


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