In Brief
A charitable medical foundation sought to challenge the constitutional validity of Section 35AC(7) of the Income Tax Act, 1961, which discontinued tax deductions for eligible hospital projects from 1st April 2018, even though the foundation's project had been approved for three financial years (2015-18). The Supreme Court held that the provision is prospective in operation and applies uniformly to all approved projects. The Court rejected arguments based on promissory estoppel, vested rights, equity or hardship in tax matters, and held that Article 142 powers cannot override statutory tax provisions. Since donors had already availed deductions in the first two years, the appeal was dismissed.
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