Gujarat CID (Crime) has registered criminal cases against four small registered political parties that, according to Income Tax Department complaints, took bank transfers from taxpayers, issued donation receipts for tax deductions, and handed most of the money back in cash. The largest case, against the Bharatiya National Janata Dal (BNJD), covers Rs 1,143.85 crore from 56,238 donors, Gujarat Samachar reported.
The other three outfits are the Anand-based Swatantrata Abhivyakti Party and two Ahmedabad-based parties, Garib Kalyan Party and Satyavadi Rakshak Party, according to PTI, via ThePrint. No arrests had been made as of Saturday.
What the complaints allege
The income-tax law lets an individual deduct the full amount of a non-cash donation to a registered political party from taxable income. The complaints describe a trade built on that rule. A taxpayer wires money to the party. The party issues a receipt, withdraws the money against fake bills for goods it never bought, keeps a cut, and returns the rest in cash. The taxpayer claims the deduction.
For BNJD, a Deputy Commissioner of Income Tax in Ahmedabad filed the complaint on September 23, and the FIR followed on September 25, per Gujarat Samachar and IANS. The case names party president Surendrakumar Gajera, general secretary Vipul Solanki, treasurer Ronaksinh Chavda and auditor Adil Saiyed. Both outlets report commissions of 2 to 10 per cent, money routed through firms including Kajal Enterprises and Parmar Associates, and about 2.91 lakh receipts recovered in searches. IANS dates those searches to November 2025 and puts the estimated loss to the exchequer at about Rs 343 crore, over financial years 2019-20 to 2024-25.
The department puts the three other cases at the following figures, as reported by PTI and The Wire:
- Swatantrata Abhivyakti Party: about Rs 519 crore in bogus donations, Rs 155 crore in tax evaded.
- Garib Kalyan Party: about Rs 206 crore in donations, Rs 62 crore in tax evaded.
- Satyavadi Rakshak Party: a loss of Rs 124.5 crore to the government.
CID officials told PTI that office-bearers had allegedly admitted forming the parties only to earn commissions. None of these allegations has been tested in court.
The warnings came a year early
None of these names is new. In August 2025, Dainik Bhaskar reported that 10 little-known Gujarat parties had received Rs 4,300 crore between 2019-20 and 2023-24 while fielding 43 candidates who won 54,069 votes in total. Rahul Gandhi, Leader of the Opposition, asked the Election Commission whether it would investigate, The Tribune reported at the time.
Earlier this month, a BBC News Hindi analysis summarised by Scroll found that six Gujarat-based registered unrecognised parties took Rs 1,700 crore in 2023-24, more than the Rs 1,480 crore received by five national parties including the Congress and AAP. Those six fielded 15 candidates in the 2024 Lok Sabha election. BNJD, Swatantrata Abhivyakti Party, Garib Kalyan Party and Satyavadi (spelt Satyawadi in that report) Rakshak Party all appear on that list. The other two, Aam Janmat Party and New India United Party, do not figure in the FIRs reported so far.
The Election Commission’s own clean-up would not have caught them. In August 2025 it delisted 334 registered unrecognised parties that had not contested any election since 2019 and could not be found at their registered addresses. A party that puts up a handful of candidates keeps its registration, and its donors keep their deductions.
What it means for Gujarat taxpayers
The FIRs target the parties and their office-bearers, but the numbers point at donors too. More than 56,000 people allegedly used BNJD receipts alone. A deduction claimed on a donation that came back in cash is income the department can reassess, with tax, interest and penalty. Donors who took cash back are the obvious next target. If you donated to a small party in good faith, keep your bank records and receipts, and check that the party is still registered before you claim anything this year.
For readers who follow politics, the cases show a gap between registration and scrutiny. A registered party files contribution reports with the Election Commission and audit reports with tax authorities, and in these four cases nobody acted on the mismatch until the Income Tax Department ran searches.
What to watch
The next steps are arrests and chargesheets from the CID, reassessment notices to donors, and whether the two remaining parties from the BBC list face cases. The Election Commission has not said whether it will act on registrations of parties booked for this kind of fraud.
Sources: Gujarat Samachar, PTI via ThePrint, IANS via Punjab Kesari, The Wire, Scroll, The Tribune, PIB
This report was compiled and written with AI assistance from publicly reported sources, and reviewed for accuracy.