Strict construction of luxury tax law excludes member clubs from the definition of hotel for accommodation tax purposes.

The charging provision in section 4 of the Tamil Nadu Tax on Luxuries Act, 1981 applies only to luxuries provided in a "hotel", and that term is confined to residential accommodation offered by way of business for monetary consideration. Reading the charging and definition clauses strictly, the Court held that clubs cannot be treated as hotels merely because they provide rooms to members. It also held that "lodging house" cannot be separated from the statutory business motive required by the Act. Accordingly, clubs providing accommodation to their members fall outside the statutory meaning of hotel, and luxury tax cannot be levied under section 4 on such accommodation.

---

---

Issues: Whether the charging provision in section 4 of the Tamil Nadu Tax on Luxuries Act, 1981 applies to clubs that provide residential accommodation to their members and whether such clubs can be treated as hotels or lodging houses within the statutory definition.

Analysis: The statutory scheme makes luxury tax payable only on luxuries provided in a hotel, and the definition of hotel requires residential accommodation to be provided by way of business for monetary consideration. The Court read the charging provision with the definition clause and held that the word "hotel" cannot be expanded to cover clubs merely because they let out rooms to members. The Legislature had not inserted any wider definition to include clubs, unlike other enactments where such inclusion was expressly made. The Court also held that the term "lodging house" could not be detached from the statutory requirement of business motive, and the charging provision had to be construed strictly on the basis of the words used in the Act.

Conclusion: Clubs providing accommodation to their members do not fall within the meaning of "hotel" under the Act, and section 4 cannot be invoked to levy luxury tax on such accommodation.

---