Political parties should deposit funds in banks: EC

The Election Commission on Friday virtually made it mandatory for political parties to deposit their funds in banks and not to exceed ceiling limits in financial assistance for candidates to ensure transparency and accountability.

The Election Commission order in this regard under Article 324 of the Constitution (superintendence, direction and control of elections) was part a set of comprehensive guidelines on transparency and accountability in party funds and election expenditure.

Under the guidelines, the treasurer of a political party is now required to ensure maintenance of accounts at all state and lower levels and consolidated accounts at the central party headquarters.

The accounts maintained by the treasurer shall conform to the guidance note on accounting and auditing of political parties issued by the Institute Of Chartered Accountants of India. The annual accounts shall be audited and certified by chartered accountants as required under the Income Tax Act.

Under the guidelines, a party should ensure that no payment in excess of Rs 20,000 is made to any person or company in cash, except in a village or in town not served by a bank. Also it will not apply to payments made to any employee or party functionary towards salary, pension or reimbursement of expenses or where cash payment is required under any statute.