No income tax from pvt univs till: HC

The Supreme Court on Thursday upheld a High Court order that asked the National Board of Revenue (NBR) not to collect income tax from private universities in the country.

The Appellate Division upheld the order until disposed of the appeals filed over imposing 15 per cent income tax on private universities.

The court also upheld the order of final hearings on the 46 writ petitions of the private universities with the High Court in this regard.

An eight-member bench of the Appellate Division, led by Chief Justice Hasan Foez Siddique, delivered the verdict dismissing the review petition.

Additional Attorney General Sheikh Mohammad Morshed said the Appellate Division had earlier ordered a final hearing in the High Court on all writs filed against income tax collection from private universities.

But the petitioners filed a review petition in the Appellate Division seeking a stay of the order. On Thursday, the Appellate Division dismissed the review petition. As a result, there is no obstacle to hearing the rule in the High Court, he said.

Barrister Omar Sadat, counsel for the private universities, said, “We had a review petition in the Appellate Division which was dismissed. The High Court bench headed by Justice Farah Mahbub asked to hear the writ petitions immediately.”

At the same time, a 15 per cent income tax cannot be collected from the private universities until the government’s appeal is disposed of, this order has also been upheld, he said

NBR issued a gazette notification on June 28, 2007, imposing the 15% income tax on private universities, to be effective from July 1 of that year.

In another gazette notification, the NBR imposed the same 15% income tax on private universities, medical, engineering colleges and ICT institutes.

After that, different universities filed 46 writs with the High Court challenging the government decision.

Upon the hearing on the writ, the High Court on September 5, 2016, found the notifications illegal, thus ordering the NBR to refund the money realized in line with the government circulars.

Subsequently, on February 9, 2021, the Appellate Division granted leave to appeal against the verdict of the High Court that declared the government’s two notifications of 15 per cent income tax from private universities as illegal.

At the same time, NBR was directed to refrain from collecting the income tax until the appeal is resolved.