India’s top court is to hear petitions challenging a bid to end the British-era practice of giving tax exemptions to Catholic religious priests, brothers and nuns working in state-funded academic institutions (Photo: AFP)
By UCA News reporter
Jan 20 2024
INDIA – India’s top court will hear a bunch of petitions challenging a bid to end the British-era practice of giving tax exemptions to Catholic religious priests, brothers and nuns working in state-funded academic institutions.
A three judge Supreme Court bench led by Chief Justice D Y Chandrachud will hear 93 appeals in three weeks after deferring the hearing on Jan 16.
“Religious priests and nuns take a vow of poverty and their salaries get transferred to their respective congregations’ accounts. They don’t individually own anything unlike other citizens,” advocate Romy Chacko, one of the lawyers representing priests, told UCA News on Jan 19.
“The congregations file their tax returns every year in compliance with the law,” he added.
The legal clash started in 2014 after the income tax department wanted to end the exemption given to priests and nuns working in state-funded educational institutions since 1944 when India was ruled by colonial Britain.
The department, reporting to the federal government, asked the state government to deduct the tax before paying salaries to priests and nuns.
In 2014, the tax department in Kerala state in southern India deducted taxes and three priests and a nun challenged the order.
A single bench of the Kerala High Court dismissed their demand and upheld the department’s order.
A year later neighboring Tamil Nadu instructed state-funded educational institutions to deduct tax from the salaries of religious priests, brothers and nuns.
This was challenged in the state High Court and in 2019 the court agreed with the income tax department.
Later, India’s Supreme Court placed an injunction on the Tamil Nadu government order, bringing temporary relief to the aggrieved priests, nuns and brothers.
Senior Advocate Arvind P Datar has told the Supreme Court that since no income is accrued to religious priests, their salaries cannot be subjected to tax deduction.
The Catholic Church manages thousands of educational institutions as part of an initiative to provide education to the poor in remote areas in Kerala and Tamil Nadu.
These institutions are managed by missionary priests, nuns and brothers. The government gives them tax exemption as they are members of religious congregations.
Church officials are of the view that in case of an adverse order from the Supreme Court, the Catholic community will face serious economic repercussions. – UCA News
