Association for Democratic Reforms says the income of national parties from unknown sources increased by 313%

The total income of national and regional political parties between 2004-05 and 2014-15 stood at ₹11,367 crore, with the highest of ₹3,982 crore being the Congress’s share. However, 69% of the income of these parties was from unknown sources, according to an analysis done by the Association for Democratic Reforms (ADR).

The income of national parties from unknown sources increased by 313% during the decade; for the regional parties, it went up by 652%. The BSP is the only party which has got 100% of its income through donations from unknown sources. Its total income increased by 2,057%, from ₹5.19 crore during 2004-05 to ₹111.96 crore in 2014-15.

The ADR report, released on Tuesday, states that the details of donors pertaining only to ₹1,835.63 crore were available. The income from other known sources, such as the sale of assets, membership fees, bank interest, the sale of publications and party levy, was ₹1,698.73 crore, about 15% of the total.

While about 43% of the total income of six national parties was that of the Congress, the BJP stood second with ₹3,272.63 crore, just over 35%. The CPI(M) declared the third highest income of about ₹893 crore. “About 83% of the total income of the Congress, amounting to ₹3,323.39 crore, and 65% of total income of the BJP, amounting to ₹2,125.91 crore, came from unknown sources.”

Voluntary contributions

The total donations above ₹20,000 per entry, for which the national parties are to declare the sources, was about ₹1405.19 crore and the BJP topped the list for declaring the maximum of ₹918 crore voluntary contributions in the category. “The donations declared by the BJP are more than twice the donations declared by the Congress during the same period,” said the report.

The BSP has not reported any donation above ₹20,000 in the past 11 years, while the Nationalist Congress Party has not submitted its donations report to the Election Commission between 2004-05 and 2006-07. The Congress has declared donations of ₹400.32 crore.

I-T returns

According to the ADR, the Income-Tax returns of 42 of the 51 regional parties analysed were unavailable for at least one financial year. The total declared income of regional parties during the period stood at ₹2,089 crore, the highest being that of the Samajwadi Party at ₹819 crore, followed by the DMK with ₹203 crore and the AIADMK with ₹165 crore.

Based on the findings, the ADR has recommended that full details of all donors be made available for public scrutiny under the RTI.

“Some countries where this is done include Bhutan, Nepal, Germany, France, Italy, Brazil, Bulgaria, the United States and Japan. In none of these countries it it possible for almost 75% of the source of funds to be unknown, but at present it is so in India,” said the report, adding any organisation that receives foreign funding should not be allowed to support or campaign for any candidate or political party.

Tax exemption

Recently, the report mentioned that the Election Commission had recommended that tax exemption be awarded only to those political parties which contest and win seats in Lok Sabha or Assembly elections. The EC also suggested that details of all donors who donate above ₹2,000 be made public. Scrutiny of the political party’s financial documents should be conducted annually by a body approved by the EC and the Comptroller and Auditor General for greater transparency and accountability, the report said.