Freedom of Religion: Freedom from Taxes for Promotion of Any Religion

The Constitution of India ensures that every citizen of India has the right to freedom of religion. Article 27 of the Indian Constitution pertains to the ‘freedom as to payment of taxes for promotion of any particular religion.’ Freedom of religion is enshrined in the Indian Constitution.

  Article 27 is based on the rationale of freedom of religion.

Article 27 reads:

No person shall be compelled to pay any taxes, the proceeds of which are specifically appropriated in payment of expenses for the promotion or maintenance of any particular religion or religious denomination.

The Article aims to encourage and promote the secular integrity of the country.  The gist of this is that public funds accumulated as tax cannot be spent for the promotion of any specific religious faith by the State. The logic is that India is a secular state that endows citizens with the right to freedom of religion so it goes against the Constitution to pay any money out of public funds for the promotion of any religion or religious denomination.

Typically, legal disputes pertaining to Article 27 occur when some form of fee is levied on the religious body and they claim their rights under Article 27 is being violated. Remember, Article 27 pertains to the levying of a tax and not a fee. The two cannot be treated as one and the same. That is when disputes tend to begin.

Freedom of Religion: Landmark Rulings from the Supreme Court

In a landmark case of Rati Lal v. State of Bombay, AIR 1954 SC 388, the Supreme Court interpreted the scope of Article 27 and ruled that:

• Tax is a type of obligatory exaction of money by the government for public welfare.
• Tax is collected and used for the welfare of the public without reference to any special benefit granted to the tax payer.
• The tax payer gets to participate in the common benefit of the state in lieu of the tax he/she has paid.
• Fees are the money collected for public interest from some special group of people, for special services are provided to them.
• A levy is considered as a fee only if the purpose of collecting it is to offer special services to a particular group of people.
• The conventional view of quid pro quo regarding a fee has changed a lot. The essential part is, there should be ‘reasonable relationship’ between impositions of the fee and the services offered.

In another famous case, Sri Jagannath v. State of Orissa, AIR1954 SC 400, the Supreme Court held that levy under the Orissa Hindu Religious Endowments Act, 1939, was purely fee and not tax. The purpose of the payment was to meet the costs of the Commissioner and his office of the religious organization. The purpose of payment was not linked to the promotion of Hindu religion, but the smooth administrative working of the religious institute.