SC asks Sonia, Rahul, Sonia to submit affidavit on CBDT circular in I-T case

New Delhi: The Supreme Court on Tuesday asked UPA chairperson Sonia Gandhi and her son Congress president Rahul Gandhi to submit an affidavit in a Central Board of Direct Taxes (CBDT) circular that had “a direct bearing on the National Herald tax assessment case.”

A bench of the apex court headed by Justice AK Sikri also asked Income Tax (I-T) Department to file its reply on the affidavit to be filed by Gandhis relating to the CBDT circular.

The Supreme Court will hear the I-T case against Rahul, Sonia, and Congress leader Oscar Fernandes on January 29.

CBDT’s December 31, 2018 circular had clarified that “fresh issuance of shares are not taxable,” a stand the Congress has been maintaining before the court over the acquisition of Associated Journals Limited (AJL), the owner of the National Herald newspaper, to Young Indian Limited.

“The circular was withdrawn by the CBDT after four days on January 4,” senior advocate and former Union Minister P Chidambaram appearing for Gandhis told the apex court.

Solicitor General Tushar Mehta, appearing for the I-T Dept, informed the court that these CBDT circulars were not relevant in the present case.

He said the order for the opening of tax assessment for the year 2011-12 of Congress president Rahul, Sonia Gandhi, and Fernandes had been passed but has not been put to effect to as per the apex court’s direction.

Meanwhile, the apex court bench continued its interim order by which it had said that if I-T Department passes assessment order, it cannot be given effect to till the final disposal of the case and posted the matter for hearing on January 29.

On December 4, 2018, the top court had allowed the I-T Department to continue with the tax re-assessment for the year 2011-12 of Gandhis and Fernandes but the order will not be given effect to till the final disposal of the case.

The apex court had restrained the I-T Dept against any coercive action against them. The top court was hearing the appeals of Gandhis and Fernandes, challenging the I-T Department’s decision to reopen tax assessment related to the National Herald and Young India transactions.

Rahul, Sonia, and veteran Congress leader Fernandes had challenged September 10, 2018 verdict of the Delhi High Court after they failed to get any relief from the high court, which had dismissed their challenge on reopening of their tax assessments for 2011-12.

The I-T Department had told the high court that the All India Congress Committee had transferred funds to the tune of Rs 99 crore to AJL, the publisher of the National Herald.

Rahul had willfully chosen to not disclose the fact that he held the director’s post at Young India, I-T Department had contended. However, Rahul’s counsel had asserted before the high court that the Congress president did not receive any income from the source, and hence was not liable for any tax.

The National Herald case is an ongoing case filed in 2012 by the Bharatiya Janata Party (BJP) leader Subramanian Swamy against Sonia, Rahul, their companies and associates. In November last year, Rahul and Sonia had stated that the application filed by Swamy was not bonafide and that its sole objective was to delay the proceedings in a “lifeless case.”