India's Congress party on Friday said the country's Income Tax Department had frozen its bank accounts as part of an investigation into its income tax filing for the 2018-19 financial year.

Congress party Treasurer Ajay Maken insisted the party had done nothing to deserve the penalty, suggesting the measure was aimed at sidelining it ahead of upcoming elections.

What the Congress treasurer said

Maken said four of the party's accounts had been frozen after the tax department had issued a payment demand for 2.1 billion rupees ($253 million, €235 million) in connection with its probe.

He conceded that the party had filed its returns late by up to 45 days but said the move was worrying and unwarranted. 

"When the principal opposition party's accounts have been frozen just two weeks before the announcement of the national elections, do you think democracy is alive in our country?" Maken asked reporters. "Don't you think it is going towards one-party system?" he added.

"Today is a sad day for Indian democracy," he said, adding that Congress would appeal the decision in court and stage public protests.

Why are there democratic concerns?

Government critics and human rights groups accuse Prime Minister Narendra Modi's administration of using law enforcement to target political rivals.

Congress party leader Rahul Gandhi, from the political dynasty that dominated Indian politics over decades, was convicted of criminal libel last year after a member of Modi's Hindu nationalist BJP party filed a complaint.

He was sentenced to two years in prison and disqualified from parliament for a time until a higher court suspended the verdict.

Congress is a part of an opposition party alliance hoping to challenge the BJP.

Other key figures in the anti-BJP bloc have also found themselves under investigation.

The leader of the Aam Aadmi Party, Arvind Kejriwal, who is the chief minister of the capital region Delhi, has repeatedly faced investigation over alleged corruption in the allocation of liquor licenses.

The BJP is widely expected to win the election due by May, with Modi remaining a popular leader thanks to his overtures to India's Hindu majority.

This article was written with material from AFP.