Mid-year fixed-tax option under entertainment tax law can take effect from the chosen week, while prior-period liability continues.

Under the A.P. Entertainments Tax Act, the fixed-tax option under section 5 may be exercised during the financial year, not only at its start, because the scheme and form III allow the proprietor to opt from the week in which fixed payment is desired. Rule 27(12) governs renewal for the succeeding year and does not limit the initial exercise of option. Liability for the period before the option is exercised continues under the amended charging provision in section 4, so any differential tax for that earlier period remains payable.

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Issues: (i) Whether an exhibitor could exercise the option under section 5 of the A.P. Entertainments Tax Act during the financial year and have the fixed-tax scheme apply from the date of exercise; (ii) whether the demand for differential tax for the earlier period was sustainable under amended section 4.

Issue (i): Whether an exhibitor could exercise the option under section 5 of the A.P. Entertainments Tax Act during the financial year and have the fixed-tax scheme apply from the date of exercise.

Analysis: Section 5 and rule 27(2) contemplate that the proprietor may signify the intention to pay tax under the fixed scheme by applying in form III from the week from which such payment is desired. Rule 27(12) governs renewal for the succeeding financial year and cannot be read as confining the initial exercise of option only to the commencement of the financial year. The scheme of section 5, the rules, and form III shows that the unit is the week and that the option may be exercised at any time during the financial year, remaining effective till the end of that year.

Conclusion: The option under section 5 could be exercised during the financial year, and the contrary demand was unsustainable.

Issue (ii): Whether the demand for differential tax for the earlier period was sustainable under amended section 4.

Analysis: For the period before the petitioner opted for section 5, the theatre remained liable under amended section 4. The petitioner had not exercised the option under section 5 for that earlier period, and the assessment under the amended charging provision for that part of the year was upheld by the authorities. No ground was made out to interfere with that component of the demand.

Conclusion: The demand for the earlier period under amended section 4 was sustained and was not disturbed.

Final Conclusion: The revision succeeded only to the extent of the demand based on the mistaken rejection of the mid-year option under section 5, while the remaining tax demand was maintained.

Ratio Decidendi: Where the statutory scheme permits a fixed-tax option on a weekly basis and does not expressly restrict the initial exercise of that option to the first day of the financial year, the option may be exercised during the year and must be given effect from the chosen week, while liability for any prior period continues under the normal charging provision.

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