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Press Release

Date: 27th Oct, 2017

Analysis of Income & Expenditure of Regional Parties for FY 2015-16

 

This report, prepared by Association for Democratic Reforms (ADR) focuses on Income and Expenditure of Regional Parties, during the Financial Year 2015-16, as submitted by the parties to the Election Commission of India (ECI).

For details of share of donations above Rs 20,000 in total donations to the party, top sources of income and top items of expenditure of the parties, please refer to the detailed report in English attached herewith.

Executive Summary

  • For the FY 2015-16, the due date for submission of annual audited accounts for the parties was 31st Oct,’16.
  • Out of the total 47 regional parties, only one-third had submitted their audit reports on time. Sikkim Krantikari Morcha (SKM) was the first party to submit, on 11th June, 2016 while AAP was the last party to submit its report, on 13th July, 2017, 254 days after the due date.
  • 16 Regional parties have delayed their submission by several days, ranging from 22 days to over 8 months or 254 days.
  • 15 Regional parties which have not submitted their audit report to the ECI, till date include some of the major regional political parties like SP, JKNC, RJD, INLD, AINRC, AIUDF, AJSU, MGP etc.

 

Total Income and Expenditure of Regional Political Parties for FY 2015-16

  • Total income of the 32 Regional Parties for FY 2015-16 was Rs 221.48 crores of which the parties spent Rs 111.48 crores and declared an unspent amount of Rs 110 crores (49.67% unspent of total income).
  • 14 out of 32 regional parties have reported incurring expenditure more than their total income. Out of these, 3 parties, JVM-P, JDU and RLD have spent close to 200% of their total income in the FY 2015-16.
  • 3 parties i.e. DMK, AIADMK, and AIMIM, have more than 80% of their income remaining unspent.

Total Income of Regional Parties FY 2015-16

  • DMK has the highest income of Rs 77.63 crores amongst all regional parties, followed by AIADMK with Rs 54.938 crores and TDP with Rs 15.978 crores.
  • Parties with top three income alone comprise more than 67% of the total income of 32 regional parties, collectively.

Unknown sources of income of Regional Parties for FY 2015-16

  • In order to compute the unknown sources of income of political parties, it is essential to have details of IT returns as well as donations statements of the political parties. Both the details were available only for 18 Regional Parties.

 

  • Total income (from known and unknown sources) of 18 Regional parties during FY 2015-16: Rs 206.21 cr.
  • Total income of political parties from known donors (details of donors as available from contribution report submitted by parties to Election Commission): Rs 90.74 cr, which is 44% of the total income of the Regional parties during FY 2015-16.
  • Total income of political parties from other known sources (e.g., sale of assets, membership fees, bank interest, sale of publications, party levy etc.): Rs 74.86 cr, or 36% of total income.
  • Total income of political parties from unknown sources (income specified in the IT Returns whose sources are unknown), for the FY 2015-16 is Rs 40.61 cr, which is 20% of the total income of the parties from all over India. National Parties declared collecting 68.57% (Rs 708.48 cr) of their total income from unknown sources during FY 2015-16.
  • Out of the 18 parties, JMM is the only Regional Party not to declare any income under unknown sources during FY 2015-16.

Details of unknown sources of income as declared by the parties in their IT Returns

  • Among the unknown sources of funding, maximum funds were collected under “Voluntary Contributions” by seventeen Regional Parties during FY 2015-16. A total of Rs 28.945 crores was collected under “Voluntary Contributions” which formed 71.28% of the total income from unknown sources of the Regional Parties.
  • The second most preferred unknown source of funding was “Gross Receipts” under which SAD collected a total of Rs 6.59 crores which formed 16.23% of their total income from unknown sources during FY 2015-16.
  • Six regional parties have more than one unknown source of income while eleven have only one unknown source of income.
  • Parties with highest unknown sources of income are: TRS (Rs 7.245 crores), TDP (Rs 6.876 crores) and SAD (Rs 6.59 crores). For TRS and SAD, their income from unknown sources forms more than 81% of their total income.

Recommendations of ADR

  • The Supreme Court gave a judgment on September 13, 2013 declaring that no part of a candidate’s affidavit should be left blank. Along the same lines, we recommend that the Election Commission India impose rules that no part of the Form 24A submitted by political parties providing details of donations above Rs 20,000 should be left blank.
  • Full details of all donors should be made available for public scrutiny under the RTI. Some countries where this is done include Bhutan, Nepal, Germany, France, Italy, Brazil, Bulgaria, the US and Japan. In none of these countries is it possible for 75% of the source of funds to be unknown.
  • Any party which does not submit its IT returns or donation statement to the ECI on or before the due date, their income should not be tax-exempted and defaulting parties should be derecognized.
  • Those parties not following the ICAI guidelines for auditing of reports should be scrutinized by the IT department.
  • The Regional political parties must provide all information on their finances under the Right to Information Act. This will only strengthen political parties, elections and democracy.
For Full Report : CLICK HERE