The High Court held in favour of assessee as under:
1) The expression 'medical attention' in section
10(23C)(iiiae) cannot be read to be confined to medical treatment of persons
who are only suffering from an illness or a mental disability;
2) A hospital which provides for maternity care will
fulfill the description of a hospital for the reception and treatment of persons
requiring medical attention;
3) The Tribunal has dealt with at length its own
view of the process of child birth. The Tribunal regards child birth as an act
of God and a natural process and has proceeded to refer to the fact that in the
olden days, deliveries were performed by midwives at individual households;
4) According to the Tribunal it was only because of
the anxiety of people in modern times to be relieved of discomfort or pain
during labour, that patients choose hospitals. This was not a correct
assessment either of modern science or of statutory interpretation;
5) It is a matter of common experience that a
hospital providing for maternity care has to deal with emergencies and on
occasions, such hospitals have to provide emergent care which was often
necessary to save the lives of the mother and the child.
6) The views of Tribunal couldn’t be accepted as
there was considerable reduction of maternal mortality due to availability of
expert medical care. Therefore, maternity hospitals which exist solely for
philanthropic purposes and not for profit are entitled to tax exemption under
section 10(23C) - Nehru Prasutika
Aspatal Samiti v. CIT [2014] 41 taxmann.com 283 (Allahabad)
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