In Light of SC Judgement on EWS, Petition Seeks Tax Exemption on All Families Earning below Rs8 lakh; Madras HC Issues Notices to Union Govt
Moneylife Digital Team 25 November 2022
The Madurai Bench of the Madras High Court (HC) has sought the response of the Centre on a plea (Case No: WP(MD) 26168 of 2022) challenging the fixation of Rs2,50,000 as the base income for the purpose of collecting income-tax (I-T), given the recent Supreme Court (SC) decision upholding the validity of 103rd Constitutional amendment providing reservation to economically weaker sections (EWS) of the society with gross annual income below Rs7,99,999.
The bench of justice R Mahadevan and justice Sathya Narayana Prasad on Monday ordered notice to the union ministries of law & justice, finance personnel, public grievance and pension and adjourned the matter by four weeks. The petitioner, Kunnur Seenivasan, an agriculturist and a member of asset protection council (DMK Party) approached the court to set aside the First Schedule, Part-I, paragraph-A of the Finance Act, 2022 fixing the rate of I-T. As per the Schedule, any person whose total income does not exceed Rs2,50,000 is exempted from payment of tax.
The petitioner challenged this Schedule on the basis of the recent SC decision in Janhit Abiyan v. Union of India, in which, while upholding the 10% reservation to the economically backward community, the apex court confirmed that a socially forward community family having income up to the limit of Rs7,99,999/- per annum excluding assets is an EWS family.
In his petition, the petitioner has highlighted that when the government decided to classify a particular section or groups of people as EWS for getting reservation by fixing gross income, the very same yardstick should be applied for all other sections of people and it shall not collect I-T from all EWS individuals. Hence, the First Schedule, Part-I, paragraph-A of the Finance Act, 2022, [No.6 of 2022], has to be declared as ultra-vires and against the Article 14, 15, 16, 21 and 265 of the Constitution of India.
In his petition, Mr Seenivasan also remarked that the office memorandum issued by the Centre fixing Rs8,00,000 per annum as the criteria for economic reservation destroyed the purposes of other provisions contained in Article 15 and 16 of the Constitution of India. 
The present I-T Act schedule is against the SC judgement, because it would lead to collecting tax from the economically poor citizens and they would not be able to compete with the forward community people in status or education or on economic front.
1 year ago
Good move.
1 year ago
The Government will most likely doll out lot of goodies in the union budget 2023 for lower and middle income group considering the 2024 election.
1 year ago
Excellent logic for demanding raising of Income Tax exemption limit to gross income of Rs.8.00 lacs. But I am sure central government will wriggle out of situation by arguing that those earning upto TAXABLE income of Rs.5.00 lacs do not pay any income tax (by availing rebate u/s sec.87A). And gross income of Rs.8.00 lacs can be brought down to taxable income of Rs.5,00 lacs by availing all available exemptions!
Kamal Garg
1 year ago
Good case filed. This case should be highlighted by the media and relentlessly pursued to its logical legal conclusion. How can Government fix (by a constitution amendment) EWS criterion having an income less than Rs. 8 lakh while at the same time levying income tax on the same income. Does it mean that the Government has been oppressive on the poor and weaker section of the society by levying harsh income tax from them.
1 year ago
The IT exemption should increase up to 10 lakh per year. Even a daily worker is getting more than 2.5 lakh.
1 year ago
1 year ago
Will the sun shine on the "middle class" now converted into "EWS" for political gains?
Meenal Mamdani
1 year ago
Excellent. The Supreme Court judgement was not only wrong but particularly insensitive to the continued oppression of the Scheduled Caste and Tribes.
Just shows how clueless the higher caste are to the reality of life for Dalits.
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