HC declared 15% imposed tax to Pvt. uni was illigal

HC declared 15% imposed tax to Pvt. uni was illigal

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Dhaka-The High Court (HC) yesterday declared illegal the 15 percent income tax imposed by the government on the private universities and private medical, dental and engineering colleges.The HC bench comprising of Justice Sheikh Hassan Arif and Justice Bishwadeb Chakrabarty delivered the verdict after scrapping two government orders imposing the 15 percent tax on the private universities.
On June 28 in 2007, the government and on July 1 in 2010 issued two separate circulars asking the private universities to pay 15 percent income tax to the government fund.
In a June 28, 2007 circular, the National Board of Revenue (NBR) said it had revised the income tax for private universities up to 15 percent.
It, however, said incomes of private medical, dental and engineering colleges as well as any private educational institutions will be tax-free, but filing tax returns will be mandatory.
In 2010, the NBR issued another circular where it said they had ‘lowered’ the income tax for private universities, medical and dental colleges, engineering colleges and institutions offering IT education to 15 percent.
But, in its verdict, the HC yesterday said that the two gazette notifications were contradictory with the section 15, 17, 27, 31 and 32 of the Constitution.
The HC verdict also said that the two government gazette notifications were also contradictory with the section 44 (4)(B) of the Income Tax Ordinance-1984. There for the two gazette notifications are being declared illegal, the HC said.
The HC also observed that the government, by imposing 15 percent tax on the institutions, had violated equal protection of law for the young citizens of the country in terms of Article 27 and Article 31 of the Constitution.
“Now, there is no need for the private universities and private medical, dental and engineering colleges to pay income tax to the government following the High Court verdict,” barrister Shakhawat Hossain, one of the counsels for the writ petitioners told reporters after the HC verdict.
He also said that the HC ordered the National Board of Revenue (NBR) to return the money, which were collected from the private universities in the meantime.
On the other hand, deputy attorney general Sardar Mohammad Rashed Jahangir said that the government would file an appeal with the Supreme Court against the High Court order as the matter is involved with the revenue of the government.
Soon after the issuance of the circulars the government to collect 15 percent vat from the private universities, several private universities’ authorities had moved before the HC challenging the legality of the government orders.
After hearing 42 writ petitions filed by 41 private universities, the HC had on August 9 in 2015, issued separate rules asking the government to explain within four weeks why the 15 income tax imposed by the government on the private universities should not be declared illegal.
Secretaries to the ministries of education, finance and law and chairmen of National Board of Revenue and University Grants Commission were made respondents to the rule.-TAFF REPORTER

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