The amount, he felt, should be handed over to the Commission for spending exclusively on primary and secondary education. And if the Gram Panchayats are involved in this disbursal process, then they should be made accountable to the Finance Ministry.

Giving an interpretation of the fine print details in the Finance Bill, he said, as per the wording, the Central Government may use it entirely or a part of it on education as per its discretion.

The Centre, he felt, should be duty-bound to spend the money exclusively on education, as otherwise "it would be a fraud on the assessee from whom it is collected as an education cess".

Mr Dastur said the education cess levied by the Government is over and above the income-tax surcharge and individuals who do not pay a surcharge cannot be legally made to pay the cess. Such collection from individuals can be legally challenged, he pointed out.

Fringe Benefit Tax

Dwelling at length on both favourable and adverse provisions in the Union Budget 2007-08, Mr Dastur said applicability of Fringe Benefit Tax to Employee Stock Options, while being equitous in a sense, as it may be deemed as a benefit to the employees at the time of exercising the option, can lead to litigation as three different sections are involved, pertaining to allotment and valuation of the stock options.

He said considering the huge shortage of hotel rooms across the country, and since tourism industry, linked to hospitality sector, can generate jobs, the tax-holiday benefit (up to 2010) should have been extended to new hotel projects all over India, and not exclusively to Commonwealth Games related infrastructure in Delhi NCR and Gurgaon regions.