Case Law Details
Nirmal Rani Provincial House Vs. Union of India (Kerala High Court)
Facts:
1. The appellants submitted that the salaries received by the nuns and priests and made over to the religious congregations were not chargeable to income tax, and tax was never deducted at source from the salaries paid to them. They relied upon circulars issued by the Central Board of Direct Taxes (CBDT) in 1944 as well as in 1977 to claim exemption from TDS.
2. In the year 2014, Income Tax Officers informed District Treasury Officers that proper deduction of TDS must be effected in the case of employees of Government or aided institutions, who are members of religious congregations receiving salary from the Government exchequer
3. The appellants also contended that as per the canon law, once a perpetual vow of poverty is taken, the nun or priest undergoes a civil death, and thereafter, they are not ‘persons’ under the Act. The petitioners argued that Nuns and priests are not entitled to have any income or hold any property, and all their properties, assets including salary and pension, belong or accrue to the religious congregation.
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