Club luxury tax liability under the unamended law survived mutuality because the statute expressly covered residential accommodation

Under the pre-2012 Delhi Tax on Luxuries Act, a members' club remained liable to luxury tax on receipts from residential accommodation because the unamended charging scheme expressly treated the club as an establishment and a hotelier for that purpose. The doctrine of mutuality did not defeat the levy where the validity of the original statutory extension to club accommodation was not challenged. The later 2012 amendment, including the definition of luxury, did not govern earlier assessment years and did not alter liability under the prior regime.

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Issues: Whether a members' club was liable to luxury tax under the Delhi Tax on Luxuries Act, 1996 for the assessment years concerned despite its claim of mutuality and notwithstanding the later 2012 amendment.

Analysis: The applicable law was the unamended Act, as the assessments related to periods prior to the 2012 amendment. Under that regime, the Act defined a club as an establishment, treated such an establishment as a hotelier, and imposed tax on the turnover of receipts from the provision of residential accommodation. The challenge based on mutuality did not succeed because the petitioner did not question the validity of the original statutory scheme that specifically extended the levy to residential accommodation in a club. The later insertion of the definition of luxury did not govern the assessment years in question, and authorities based on post-amendment law did not alter the position under the pre-amendment Act.

Conclusion: The club was held liable to luxury tax under the pre-2012 provisions of the Act, and the challenge to the assessment and appellate orders failed.

Ratio Decidendi: Where the charging statute, as it stood during the relevant assessment period, expressly extends luxury tax to residential accommodation provided by a club, the doctrine of mutuality does not by itself defeat the levy unless the validity of that statutory scheme is challenged.

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