Entertainment tax levy invalid where notifications and bye-laws lacked assessment machinery and dispute adjudication framework.

Entertainment tax notifications and bye-laws were found non-compliant with Section 62(2) of the Punjab Municipal Act, 1911 because they did not clearly specify the class of persons liable, the mode of assessment, the assessing authority, or any machinery for adjudicating disputes. Although the scheme fixed rates per show and required collection through cinema authorities, a penalty clause for breach did not replace a proper assessment and dispute-resolution mechanism. The levy therefore failed to satisfy the mandatory statutory conditions and was quashed.

---

---

Issues: Whether the show tax notifications and the bye-laws regulating entertainment tax were invalid for failure to comply with the mandatory requirements of Section 62(2) of the Punjab Municipal Act, 1911, in not specifying the class of persons liable, the mode of assessment, the assessing authority, and the machinery for adjudication of disputes.

Analysis: The levy and collection scheme was examined against the statutory requirement that the taxing instrument must clearly identify the person liable and provide an effective assessment mechanism. The notifications fixed rates per show and the bye-laws required collection by cinema authorities, but neither instrument designated an assessing authority nor provided any machinery for resolving disputes about the amount payable. A mere provision for punishment upon breach did not substitute for an adjudicatory mechanism to determine whether tax had been correctly assessed, paid, or short-paid. On that basis, the levy was held to fall short of the mandatory statutory conditions.

Conclusion: The notifications and bye-laws were held to be violative of Section 62(2) of the Punjab Municipal Act, 1911 and were quashed.

---