Supreme Court will consider whether nuns and priests working as teachers are entitled to income tax exemption or not

The Supreme Court has agreed to consider an important legal question. The Supreme Court has agreed to consider whether nuns and priests working as teachers in government-aided Christian missionary schools are entitled to income tax exemption.

A bench of Chief Justice DY Chandrachud, Justice JB Pardiwala and Justice Manoj Mishra on Thursday took cognizance of senior advocate Arvind Datar's submission that the petition by several dioceses and congregations in Tamil Nadu and Kerala on the issue required urgent hearing.

The bench agreed to consider listing the petition in which the issue was raised whether income tax could be imposed on the income of nuns and priests working as teachers. In December 2014, the Income Tax Department asked education authorities to levy tax deducted at source (TDS) of income of people working as teachers.

The appeal has been filed in the apex court after the high courts did not agree on the objections raised by about 100 dioceses and congregations from Tamil Nadu and Kerala. The petition states that the income of the nuns and priests becomes the income of the congregation that runs the school and these teachers do not personally receive the amount paid as salaries.

The High Courts of Madras and Kerala rejected the petitions for income tax exemption. The petitions said government-aided missionary schools continued to get IT exemption since 1944 until the central government decided to implement tax deductions at the source of income in 2014.