Major push by ECI for Enforcing due Compliances by RUPPs; financial irregularities reported

The Election Commission of India (ECI) has taken steps to ensure that Registered Unrecognized Political Parties (RUPPs) are complying with applicable provisions 29A and 29C of the RP Act 1951. There are 2796 RUPP as of September, 2021 which is an increase of over 300% since 2001 .

The Commission recognises that adherence to the Act's conditions and rules is necessary for sustaining financial discipline, propriety, public accountability, openness, and voter empowerment in making informed decisions. 

The electorate and ECI are deprived of basic factual information in ensuring ECI's mandate of conducting free, fair, and transparent elections if required compliance is not met. 

The Commission has evidence of major financial irregularities, wilful attempts at tax evasion, and other illicit financial actions involving three specific Registered Unrecognized Political Parties (RUPPs), amounting to a dishonest exploitation of privileges and public trust.

Every RUPP so registered is required to comply with the following rules/instructions and directions: 

1. Section 29C of RP Act 1951requires a RUPP to furnish a contribution report as prescribed in Form 24 A under Rule 85 B of Conduct of Election Rules 1961.Such contributions received by RUPPs are also 100%exempted from Income Tax as an incentive to the parties for strengthening the electoral democracy. 
2. Section 29A(9) mandates every political party to communicate any change in its name, head office, office bearers, address, PAN number to the Commission without delay. 
3. The political parties are mandated to also furnish Audited Annual Statements, flowing from ECI’s transparency guidelines dated 29/08/2014.Hon’ble Supreme Court in Common Cause vs UoI& Others (AIR 1996 SC 3081) has upheld the requirement of maintaining audited accounts by the political parties as mandatory and to be strictly enforced. The political parties, therefore, are under a statutory obligation to furnish a return of income for each assessment year to be eligible for exemption from income-tax. 
4. The Political Party, [for being registered, as a condition precedent prescribed by ECI under its power under section 29 A (6)] needs to undertake to include in its constitution that it must contest an election conducted by the Election Commission within 5 years of its registration. 
5. Further, upon participation in an election, Political Parties are required to furnish their election expenditure statement within 75 days, in case of Assembly elections, and within 90 days, in case of Lok Sabha elections.