Registered Unrecognised Political Parties (RUPPs) in India are facing increased scrutiny following reports of massive financial inflows despite minimal electoral activity. An investigation into six such parties in Gujarat revealed they collectively received approximately 17 billion rupees in the 2023-24 financial year while fielding only 15 candidates in the 2024 general election. Many of these organizations operate from inactive addresses, and officials often struggle to explain the source or expenditure of their significant funds.
Tax authorities have been investigating the potential misuse of these entities since at least 2022, identifying billions of rupees in suspected bogus donations and foreign transaction violations. While these parties are legally registered and eligible for tax exemptions, experts and officials suggest that intermediaries may be using them to help taxpayers reduce their taxable income. Some party leaders have admitted to having little control over their own finances, pointing instead to chartered accountants who manage the funds.
Although the Election Commission has delisted hundreds of inactive parties, its power to cancel legal registrations remains limited. As investigations continue, authorities face the complex challenge of tracing the origins of these donations and determining the ultimate beneficiaries of the funds. None of the parties examined by the investigation have been publicly named in official inquiries, and no financial wrongdoing has been formally established.
