Flagging discrepancies in its electoral funding statement, the Election Commission threatened the AAP with action for "prima facie failing" to follow its transparency guidelines.
In its show-cause notice, the EC claimed that transactions through hawala operators were "wrongly disclosed as voluntary donations".
The EC has asked the Aam Aadmi Party (AAP) to respond to the notice "within 20 days", failing which it will decide on the cases on merit based on the information available with it and the Central Board of Direct Taxes (CBDT).
Rule 16 A of the Election Symbols (Reservation and Allotment) Order allows the EC to either suspend or withdraw recognition of a recognised political party.
The AAP is a recognised state party in Delhi.
The notice said the AAP had submitted the original contribution report for Financial Year 2014-15, which was received by it on September 30, 2015.
The party later submitted a revised report on March 20, 2017.
"The original report contains a list of 2,696 donors with the total donations amounting to Rs 37,45,44,618 and the revised contribution report shows the total amount as Rs 37,60,62,631 received from 8,264 donors," it said.