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Income-tax Act, 1961 · Chapter III: Incomes Which Do Not Form Part of Total Income

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

The Income-tax Act, 1961 was repealed by the Income-tax Act, 2025 from 1 April 2026. The text is kept here because the judgments below apply it.

In plain words

This section exempts specific income types for registered political parties from their total income. The exemption applies to income from house property, other sources, capital gains, and voluntary contributions. To qualify, parties must maintain proper books, audit accounts, and follow strict rules for receiving donations. Failure to submit required reports or file returns on time removes the exemption for that year.

  • Exempt income includes house property, other sources, capital gains, and voluntary contributions.
  • Parties must keep books allowing the Assessing Officer to deduce income.
  • Records of name and address are needed for voluntary contributions over twenty thousand rupees, excluding electoral bonds.
  • Accounts must be audited by an accountant as defined in section 288.
  • Donations over two thousand rupees must be received via account payee cheque, draft, electronic clearing, or electoral bond.
  • Exemption is lost if the treasurer fails to submit the report under section 29C of the Representation of the People Act, 1951.
  • Parties must file a return of income under sub-section (4B) of section 139 by the due date.

Example: If a registered party receives a voluntary contribution in excess of twenty thousand rupees, it must record the donor's name and address. If the party fails to file its return of income by the due date, the exemption for that financial year is not available.

A simplified explanation, prepared with AI assistance from the official text below and checked automatically against it for numbers and cross-references. The official text is the law and prevails over this summary. Not legal advice.

Official text

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 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).]

Source: India Code (Legislative Department), the text of the Act as it stood before its repeal. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.

Supreme Court judgments citing the section 13A