Election commission of India revises cash expenditure limit to Rs 10,000 from Rs 20,000

The Election commission of India (ECI) has revised incurring expenditure cash limit upto Rs 10,000 from the existing Rs 20,000 in the uniformity of the Income Tax Regulations. The existing norms of the commission restrict a candidate to make payments exceeding Rs 20,000 through account payee cheque/draft only. The commission has referred section 40A (3) of Income Tax Act, 1961 in order to regulate this for the candidates. The commission’s norms were found in contrast to the Income Tax department norms updated. The department, through a notification dated April 4, 2017, had reduced the limit of cash and kept it Rs 10,000 from Rs 20,000.

With the latest notification, the candidates were in the state of confusion whether they would file the expenditures details accordingly to the election body or the income tax department. Their major worry is that they may be in legal trouble for flouting both rules, which are contradictory to each other. The DNA had raised the issue of contradictory norms in the report titled ‘Conflicting ECI and IT norms may land candidates in legal trouble’ published on October 27. Post to the report, the state election department approached the commission which finally released a corrigendum recently clearing airs on conflicting norms.

In the latest circular issued dated November 12, the ECI stated that cash limit has been revised and decided to be kept in accordance with the income tax.