The Madras High Court has held that salaries and grants-in-aid to nuns and priests are liable to attract tax deducted at source.
“In our opinion, the provisions of Income-Tax law are dry, plain and simple, a political and a religious in character,” the court said in a recent order.

The bench, comprising Justices Vineet Kothari and C V Karthikeyan, gave the order on a writ appeal filed by the Union of India and the Income-Tax Department against the Society of Mary Immaculate and the State’s Directors of Treasuries and Accounts, School Education and Elementary Education.

The court also set aside, a previous 2016 ruling by a Single Judge of the Madras High Court on a writ petition by the Institute of the Franciscan Missionaries of Mary against the Union of India and others, which had allowed the writ petitions, and had said TDS was not applicable on salaries and other benefits given to nuns and priests working in teaching institutions.