Article 27 of Indian Constitution: Tax Prohibition for Religion

Article 27 prevents the imposition of taxes on citizens that are used to promote or maintain any religion or religious denomination. This provision is part of the fundamental rights under the Freedom of Religion and it embodies the principle of secularism. It ensures that public funds collected through taxes are not collected to support any particular religion. Article 27 contains following essential elements-

1. The term “person” has a broader definition and may refer to-

• Individuals
• Companies
• associations or 
• entities

1. Article 27 applies specifically to taxes which are contributions levied by the state to meet its general public expenditures.
2. The taxes referred to in Article 27 must be intended for the promotion or maintenance of a particular religion or religious denomination. The intention of the state behind levying the tax is critical in determining whether the article has been violated.
3. It also ensures that no person is compelled to pay a tax if its proceeds are used for promoting or maintaining a particular religion.

For Article 27 to be violated, the following conditions must be satisfied:

• There must be a tax.
• The proceeds of such tax must be used for the promotion or maintenance of a religion or religious denomination.
• A person is compelled to pay the tax.
• The dominant purpose behind the tax must be to promote or maintain a particular religion.

The judiciary has played an important role in interpreting and enforcing Article 27 of the Indian Constitution.

Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (1954)
In this case the Supreme Court dealt with the question of whether contributions levied on religious institutions under the Madras Hindu Religious and Charitable Endowment Act, 1951, were taxes or fees. The petitioner contended that the contributions levied under the Act were taxes, and the state of Madras was not competent to enact such a provision under Article 27.

The Supreme Court held that although the contribution had characteristics of a tax it was not intended for the promotion or maintenance of any religion. In Fact it was imposed for the proper administration of the religious institution, a secular activity. The decision in this case also established a key distinction between taxes for administrative purposes and taxes for religious promotion.

Article 27 is a constitutional safeguard that ensures public funds are not used for promotion or maintenance of religious activities. The scope of Article 27 has been analyzed through judicial interpretations including the Shirur Mutt case highlighting the secular nature of the state. The distinction between taxes for administrative purposes and taxes for religious promotion is key to understanding the application of Article 27.