Article 25 Does Not Provide Any Immunity From Taxation On The Basis Of Religion, Salaries Of Nuns and Priests Working As Teachers Liable To TDS: Kerala High Court

The Kerala High Court ruled that salaries paid to nuns and priests of religious congregations, working as teachers in educations institutions are liable for tax deduction at source while dismissing a batch of nearly 50 writ appeals. A Division Bench of Justice SV Bhatti and Justice Bechu Kurian Thomas upheld the rider of a Single Bench and observed that such deduction of tax does not violate freedom of religion under Article 25 of the Constitution. “Article 25 does not provide any immunity from taxation on the basis of religion”. “If a valid law permits deduction of tax at source, we find ourselves at a loss to assimilate the scope of the contention that deduction of tax at source violates the fundamental right to freedom of religion,” the Court remarked. The Bench also turned down the contention that nuns and priests do not utilize the salary they get but rather give it to their congregation, holding that if the income payable falls under the head ‘Salaries’ under Income Tax Act, the statute attaches an obligation to the person paying the salary to deduct TDS. “While deducting the TDS under section 192 of the Act, the person deducting it, is not obliged to or required to ascertain the nature of calling or vocation of the assessee or utilization or application of the income by the assessee,” the Court underscored.