Entertainment tax exemption does not permit cinema owners to retain tax collected from viewers unless expressly authorised by the scheme.

Exemption under the 11 August 2000 scheme did not authorise cinema proprietors to collect entertainment tax from viewers and retain it as incentive or grant-in-aid. The earlier 1994 and 1998 Government Orders were compensatory grant-in-aid schemes for cinema hall owners, but the later scheme operated as an exemption for the benefit of cinema-goers and to widen the tax base. Since the charging provision continued to apply, tax collected from viewers remained payable to the Government. The District Magistrate's direction for separate disclosure in Form B was only for statistical purposes and did not create any right of retention. The demand for deposit was therefore valid.

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Issues: Whether the petitioner, after obtaining exemption under the Government Order dated 11 August 2000 and the order of the District Magistrate, was entitled to collect entertainment tax from cinema-goers and retain it as an incentive or grant-in-aid.

Analysis: The earlier Government Orders of 1994 and 1998 operated as grant-in-aid schemes meant to compensate cinema hall owners, whereas the Government Order dated 11 August 2000 introduced a different scheme of exemption under Section 11(2) of the Uttar Pradesh Entertainments and Betting Tax Act, 1979. The new scheme was framed for the benefit of cinema-goers and for expanding the tax base, not for allowing owners to appropriate tax collections. Section 3 of the Act remained the charging provision, under which entertainment tax collected from viewers had to be paid to the Government. The District Magistrate's order only required separate disclosure in Form B for statistical purposes and did not authorise retention of the tax amount.

Conclusion: The petitioner was not entitled to retain the entertainment tax collected from cinema-goers, and the demand for deposit of the amount was valid.

Final Conclusion: The writ petition failed because the exemption scheme did not create any right to keep the collected tax as personal benefit or grant-in-aid.

Ratio Decidendi: Exemption from liability to pay entertainment tax does not authorise the proprietor to collect and retain the tax unless the governing order expressly creates such a right.

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