Key Points
- Six small parties under investigation received about Rs 17 billion($190 million)
- One Gujarat-based party reported billions in donations while contesting just one seat
- Indian tax authorities have identified suspected bogus political donations
ISLAMABAD: Large donations received by little-known political parties in India are drawing scrutiny over the sources of the money, the parties’ activities, and the use of tax benefits available for political contributions.
A BBC investigation found that six Registered Unrecognised Political Parties, or RUPPs, received about Rs 17 billion ($190 million) in donations in the financial year 2023-24, despite fielding only 15 candidates in India’s 2024 general election. None came close to winning.
The findings do not establish that the six parties committed financial wrongdoing, but they highlight a significant gap between reported donations and electoral activity.
The Satyawadi Rakshak Party in Gujarat reported receiving more than Rs3.3 billion ($35 million) in 2023-24. It fielded one candidate in the 2024 election, who lost his deposit.
Its accounts recorded Rs84.8 million in election spending and more than Rs3.16 billion as spending on “public welfare”. The party’s president said the money was spent on charity, but records had not been maintained.
Another party, the Aam Janmat Party, reported donations of more than Rs6.2 billion in 2023-24, up sharply from Rs2.16 billion a year earlier. It fielded only one candidate in the 2024 election. Party officials contacted by the BBC could not explain the sudden increase.
India’s Election Commission says RUPPs are registered under Section 29A of the Representation of the People Act. In August 2025, it said 2,854 RUPPs were registered and began delisting parties that had failed to contest elections for six years.
Tax exemption for donations to Indian parties
The financial system creates an additional incentive for scrutiny. India’s Income Tax Department says contributions to political parties or electoral trusts can qualify for deductions under Section 80GGC, subject to conditions. However, companies can claim deductions under Section 80GGB for qualifying non-cash contributions.
An internal tax department document reviewed in the investigation identified Rs55.91 billion in suspected bogus political donations and Rs6.65 billion in foreign transactions, alongside possible violations of tax, foreign-funding and election laws. The investigation did not establish that the six parties examined were involved in those suspected transactions.
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The Election Commission continues to publish political-party contribution reports and maintain lists of registered, recognised and delisted parties.
The central questions now concern who controls some of these organisations, where their funding originates, whether reported expenditure reflects actual political or charitable activity, and how effectively India’s tax and electoral authorities can trace the money.
Political parties in India finance their activities through a combination of individual and corporate donations, electoral trusts, membership contributions and other declared income.
Parties are supposed to submit contribution and financial reports to the Election Commission of India, which publishes these records.
The political parties’ funding has remained contentious since the Supreme Court struck down the Electoral Bond Scheme in February 2024.
The scheme had allowed individuals and companies to make anonymous donations to eligible political parties. The court declared it unconstitutional and ordered disclosure of previously undisclosed donor and recipient information.
The latest questions concern six unrecognised political parties in Gujarat that reportedly received more than Rs 1,500 crore ($180 million) in donations in 2022-23 despite fielding only 15 candidates in the 2024 election.
The Election Commission has previously stated it lacks legal authority to investigate the source or quantum of political-party contributions, leaving such financial scrutiny to other authorities where applicable.
