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Exempt All Persons With Less Than ₹8 L Annual Income From Income Tax In The Light Of EWS Criteria : Plea In Madras High Court

Upasana Sajeev
22 Nov 2022 3:26 AM GMT
Exempt All Persons With Less Than ₹8 L Annual Income From Income Tax In The Light Of EWS Criteria : Plea In Madras High Court
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If families earning less than ₹8 lakh annually is EWS, why should people earning more than Rs 2.50 lakhs pay income tax?, the petitioner asks.

The Madurai Bench of the Madras High Court has sought the response of the Centre on a plea challenging the fixation of 2.5 lakh as the base income for the purpose of collecting Income Tax in light of the recent Supreme Court decision upholding the validity of 103rd Constitutional Amendment providing reservation to Economically Weaker Sections of the society with gross annual income below Rs. 7,99,999.

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 4 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 Income Tax. As per the Schedule, any person whose total income does not exceed Rs. 2,50,000 is exempted from payment of tax.
The petitioner challenged this schedule on the basis of the recent Supreme Court decision in Janhit Abiyan v. Union of India, in which, while upholding the 10% reservation to the Economically Background Society, the Apex court confirmed that a socially forward community family having income upto the limit of Rs.7,99,999/- per annum excluding assets is a Economically Weaker Section family.
"When the Government fixed income criteria that a family whose having cross income upto the limit of Rs.7,99,999/- as Economically Weaker Section family for availing benefit under Economically Weaker Section reservation, the respondents should not be permitted to collect Income tax from individual having income upto limit of Rs.7,99,999/-, because there is no rationality and equality in collecting the tax"- petition.
According to the petitioner, when the Government decided to classify a particular sections are groups of people as Economically Weaker Section 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 income tax from all Economically Weaker Section of individual. 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, Seenivasan also remarked that the office memorandum issued by the Centre fixing 8 lakh 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 Income Tax Act schedule is against the Supreme Court judgment, because it would leads to collect tax from the economically poor citizen and they could not compete with the forward community people in status or education or economic.

"By the impugned First Schedule, Part-I, paragraph-A of the Finance Act, 2022, [No.6 of 2022], the respondents are permitted to collect income tax from an individual having income among Rs.2,50,000/- per annum and it would leads to maintain economic inequality among the citizen, because a section of people having income below Rs.7,99,999/-, per annum or eligible to get reservation and Economically Weaker Section, but the others are not eligible to get reservation on the basis of income criteria. Hence, it is clear violation of the fundamental rights", the plea states.

Case Title: Kunnur Seenivasan v Union of India and others
Case No: WP(MD) 26168 of 2022


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