THE BOMBAY Excessive Court docket just lately stayed the impact of ‘demand and attachment’ discover issued by the BMC to a public charitable belief operating the unaided Sharda Gyan Peeth Worldwide College in Malad catering to college students belonging to weaker sections from close by slums.
The civic authority had issued discover on the idea that municipal tax can’t be exempted as there’s a corridor used for ‘industrial functions’ located on one of many two plots occupied by the belief.
The court docket remarked that corridor being given for weddings and different occasions submit college hours to earn some earnings wouldn’t ‘prima facie rob the varsity of its main function for which it’s got tax-exempt standing.’
The civic physique had claimed that the belief that runs the unaided college surrounded by slums in Malad typically offers out the corridor for weddings and related occasions and due to this fact BMC was entitled to withdraw a tax exemption for the belief.
Nonetheless, the bench noticed, “As a parallel or instance, we could think about a scenario the place a college constructing has an meeting corridor. However after college hours, that corridor is given out in order that the belief can earn some earnings. That doesn’t prima facie rob the belief or the varsity of its main function, which is what offers it the tax-exempt standing.”
“If each exercise in a college constructing is to be assessed on this vogue, then conceivably even a canteen in which there’s levy of fees for regular meals and drinks for college kids would end in exactly such a tax exemption being withdrawn,” it added.
A division bench of Justices Gautam S Patel and Kamal R Khata on April 15 handed an order in plea by Sharda Gyan Peeth Belief and its Trustee difficult tax exemption revocation letter by BMC of June, 2018, demand discover issued by civic physique in December, 2021 and attachment warrant issued in January, 2022.
The court docket restrained the BMC officers until additional orders from appearing upon the impugned demand discover, warrant of attachment and from any taking coercive motion towards the petitioners.
Senior advocate Ashish Kamat for the petitioners argued that the civic physique can not challenge a tax demand or warrant of attachment by ‘government motion or fiat act opposite to the statute’.
The bench famous that BMC had not filed its affidavit in reply since February, 2024 and up to now, has not proceeded with coercive motion or demand towards the petitioners.
It mentioned the petition raised questions on whether or not the authority involved of the BMC was competent to challenge such a round.
Granting interim aid to the petitioners, the bench famous, “The college shouldn’t be going anyplace… We see no urgency on this matter.”
It sought BMC’s reply by Might 10 and posted additional listening to to June 11. The bench clarified that it had not totally addressed the matter on the deserves and had merely handed prima facie observations on the identical.