ALUMINIUM INDUSTRIES LTD. Vs. COMMISSIONER OF CUSTOMS, KOCHI

JUDGEMENT

(1.) -These Writ Petitions have been filed praying to call for the records relating to the impugned proceedings issued by the second respondent in Letter C. No. Misc/PRO/2015-16, dated 07.10.2015 and the consequent circular of the 4th respondent Director of Treasuries and Accounts in RC. No. 23545/2014/E1 dated 26.10.2015 insisting upon the petitioner to deduct Income Tax (TDS) from the salaries of the Religious Nuns in the service of the petitioners' school and quash the same.

(2.) By consent, all these cases are taken up for final disposal.

(3.) The only point which has been raised in all these Writ Petitions is that all these petitioners are in Catholic Institutions, religious Priests and Nuns who have been employed in the respective Schools/Colleges owned and administered by Dioceses, Congregation or institutions. The only point which is raised is whenever salaries are directly paid by the Government to the concerned religious Priests or Nuns, who are working in the schools owned by Catholic Dioceses and Congregation, TDS is sought to be deducted, whereas the concerned religious Priests and Nuns do not take the salary as their individuals salaries instead they are depositing the same to the concerned Diocese or Congregation or institution only. Therefore, they have no personal link in so far as the salary received from the Government is concerned. Some of the Institutions, Congregations or Dioceses are already exempted by the Income Tax Department from payment of income tax. Therefore, the salaries given to the Priests and Nuns when they are added to the income of the said Congregation or Diocese it is not taxable where such income from the religious Priests and Nuns now, added to the congregation income they become non-taxable. Whereas, when it is received by the concerned Priests or Nuns in their individual name, TDS is sought to be deducted by the institution but ultimately the income is being only added to the Diocese which is exempted from income tax. Therefore, it goes without saying that the ultimate beneficiaries are the congregation or Diocese, since payment of Tax has been exempted for them the salary of the Priests and Nuns received from Government should not be deducted towards TDS under Sec. 40.