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Refusal by hospitals to perform transplants concerning unrelated donors would be plainly illegal: Hon’ble Madras High Court

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Title: Mr.S.Haja Mohideen Gisthi v. Mr.C.Kathiravan Special Government Pleader

W.P. No.27106 of 2023

Decided on: 09.10.2023

CORAM: JUSTICE N.SESHASAYEE

Introduction:

The writ petition was filed under Article 226 of the Constitution of India for a Writ of Mandamus, directing the respondents to issue a No Objection Certificate, considering the petitioner’s pathetic case, and grant approval for kidney transplantation on a priority basis and save his life.

Facts of Case:

The petitioner, a doctor by profession, was diagnosed with chronic kidney disease (CKD) in June 2022 and was put on dialysis. The nephrologist advised him to go for a kidney transplant but his attempt to make his wife, child, and relatives as donors failed. The petitioner contended that Mrs. Ramayee a well-wisher offered to donate a kidney out of “love and affection”. However, the hospitals of Tamil Nadu didn’t entertain the idea of a non-relative as a donor, the petitioner then approached Lakeshore Hospital at Cochin. The kidney of Ramayee’s was found suitable for transplant and all the documents required were prepared there. The NOC under Sec.9(4) of the Transplantation of Human Organs and Tissues Act, 1994 was needed.

A proposal for NOC was sent to The Authorization Committee (Transplantation), which stated that there is no need for a NOC and the same was notified to The Authorization Committee in the state of Kerala which demanded the NOC. Petitioner being in dire need approached the Hon’ble High Court of Madras.

Court’s Analysis and Decision:

The court observed and held that the hospitals in Tamil Nadu can’t deny the transplant by a non-relative as that would be plainly illegal. The Hon’ble Madras High Court adds “This Court has reasons to believe that the apprehensions and reluctance of the hospitals here to entertain organ transplantation between non-relatives is more due to inadequate awareness of the law on the topic.”

The requirement of a NOC, which was incumbent under Rule 6-B of the 2008 Rules is no longer a requirement under the 2014 Rules. But On the issue of who has to grant the permission where the donor and recipient are of the same state but the hospital of transplant is of a different state that is Kerala, the court applied the rule in Kuldeep Singh v. State of Tamil Nadu.

Thereby the Hon’ble High Court directed the petitioner and the donor to present themselves before the Authorisation Committee for Approval of Cases for Renal Transplantation at Coimbatore within one week; and the Tehsildar to conduct an inquiry in terms of THOT Rules, 2014 and submit the report to Authorisation Committee within one week; Thereafter the Authorisation Committee to examine the case of petitioner and his donor under Rule 7(3) of THOT Rules, 2014.

The Hon’ble High Court added In case the Authorisation Committee refuses to grant approval, it is left open to the petitioner to avail the remedy of an appeal.

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Written by: Sushant Kumar Sharma

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Karnataka High Court Grants Tax Exemption for Voluntary Donations to Educational Institutions

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Karnataka High Court

Pr Commissioner Of Income-1 Tax (Exemptions) V. M/S Rashtreeya Sikshana Samithi Trust 

Income Tax Appeal No. 554 Of 2018

Bench-   HON’BLE MR JUSTICE P.S.DINESH KUMAR AND THE HON’BLE MR JUSTICE T.G. SHIVASHANKARE GOWDA

Decided On 05-06-2023

Facts of the case-

The respondent assessee in this case is a charitable trust registered under Section 12A of the Income Tax Act, 1961. The trust has also obtained approval under Sections 11 and 12. In the assessment year 2012-13, the assessee initially filed returns of income declaring a nil income. However, the case was selected for scrutiny, and notices under Sections 142(1) and 143(2) of the Income Tax Act were issued. In response, the assessee filed revised returns, claiming the difference between the original and revised returns as corpus donations. The assessee stated that the trust was exempt in the original returns and had disclosed the income under the heading ‘other income’ in the revised returns.

The Additional Commissioner of Income Tax, Exemptions, reviewed the case for scrutiny and assessment. The Assessing Officer (AO) passed an assessment order, considering the income from other sources as income for the trust. The Commissioner of Income Tax (Appeals) [CIT (A)] upheld the AO’s order. However, the Income Tax Appellate Tribunal (ITAT) reversed the AO’s order and held that the assessee was entitled to exemption.

Subsequently, the department challenged the ITAT’s order. The department argued that the assessee had collected a sum of Rs. 27,23,55,000 as a donation in violation of the Karnataka Educational Institutions (Prohibition of Capitation Fee) Act, 1984. According to the department, this violation of the KEI Act rendered the assessee ineligible for exemption, as it would also constitute a violation of Sections 11 and 12 of the Income Tax Act.

In response, the assessee contended that the absence of any action initiated under the KEI Act does not automatically imply that there was no violation. The assessee argued that the income tax authorities have the authority to consider violations of any statute while framing assessments.

Judgement

The honorable bench consisting of Justice P.S. Dinesh Kumar and Justice T.G. Shivashankare Gowda has granted a tax exemption on voluntary donations received by educational institutions. The court’s observation highlighted several crucial factors:

Firstly, the educational institution in question was found to be engaged in charitable education activities as defined by Section 2(15) of the relevant legislation.

Secondly, it was determined that the institution had appropriately applied or accumulated funds in accordance with the requirements outlined in Section 11(1)(a), including the explanation provided therein, as well as Section 11(2).

Furthermore, the institution had obtained proper registration under Section 12A, demonstrating compliance with the relevant provisions.

Importantly, the institution had not violated Section 13, which ensures that there is no private gain and that all funds are solely directed towards educational purposes. This reaffirmed that the accumulation and application of funds adhered to the provisions of Section 11.

Consequently, the court concluded that the assessing officer’s assertion, based on mere assumption and conjecture, that the institution had violated the KEI (Prohibition of Capitation Fee) Act, was unwarranted. The Income Tax Appellate Tribunal (ITAT) appropriately overturned this incorrect assumption.

In light of these findings, the court ordered the grant of exemption under sections 11 and 12 to the assessee, affirming that the institution met all the necessary criteria for tax benefits.

JUDGEMENT REVIEWED BY ABHAY SHUKLA

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