TaxTMI 
TaxTMI 
2008 (8) TMI 546
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....cates with them) for the appellant. -------------------------------------------------- The judgment of the court was delivered by AFTAB ALAM J.-Heard counsel for the parties. Leave granted. All the three appeals arise from same or similar sets of facts and involve a common question of law. Hence, all the three appeals were taken up together and are being disposed of by this judgment. The dispute relates to demands raised by the prescribed authority in terms of section 5(6) of the Andhra Pradesh Entertainments Tax Act, 1939 as the provision was in existence at the material time (section 5 now stands deleted by Act 32 of 2005 with effect from June 4, 2005). The prescribed authority raised the impugne....
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....0 of 2006, respectively] are situate in Chandan Nagar, Serilingampally. For financial years 2001-02 and 2002-03 both the respondents paid entertainment tax on slab basis in terms of section 5 of the Act (as it was in existence at that time) by making applications in form III and obtaining their respective permits in form IV. Serilingampally, where the two theaters are situate, used to be a grade III municipality but by a Government notification issued on May 19, 2001 it was upgraded as a selection grade municipality with effect from May 18, 2000, that is to say, during the period the two respondents were granted permission to pay their taxes on the basis of the slab system. Here, it may be noted that in terms of the table that was part of s....
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.... Pradesh High Court. The High Court allowed the writ petitions filed by the three respondents and quashed the impugned demands relying upon its earlier decision dated June 25, 1992 in Swamy Theatre, Sanathnagar v. Deputy Commercial Tax Officer, Santhnagar [W.P. Nos. 8432 of 1988 and 14970 of 1989]. Here, it will be useful to take a look at the relevant statutory provisions before going to the High Court decision in the case of Swamy Theatre W.P. Nos. 8432 of 1988 and 14970 of 1989 decided on June 25, 1992-Andhra Pradesh High Court. Section 5 of the Act gave the option to the theatre's proprietor to pay entertainment tax on slab basis. The provision allowed for payment of a fixed weekly amount as tax, determined on the basis of such fa....
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....) of section 5 of the Act at any time if there is an increase in the gross collection capacity per show in respect of the place of entertainment by virtue of upward revision of the rate or the rates of payment for admission therein or of the seating capacity or accommodation thereof or where the local area, in respect of which permission is granted is upgraded or if it is found for any reason that the amount of tax has been fixed lower than the correct amount." (emphasis added) In view of the provisions in the Act and the Rules it was contended on behalf of the respondents that the prescribed authority undoubtedly had the power to vary the amount of tax fixed under section 5 but the power could be exercised only during the period for whi....
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....; (2) Increase in the seating capacity or accommodation; (3) Upgradation of the local area where the theatre is situate; and (4) If a lower rate of tax was fixed due to any other reason. If the abovesaid jurisdictional facts are present, the opening words of section 6, namely, 'it shall be lawful for the prescribed authority to vary the amount of tax payable by the proprietor under sub-section (1) during the period of option permitted under this section at any time' come into operation. The words 'at any time' signify the limitation of time aspect confining the same to the period of option. In other words, the period of option qualifies the time factor inferable from the words 'at any time'." Thus, according to the High Court....
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....vary the tax 'during the period of option'. The words 'during the period of option' occurring in sub-section (6) must be read into sub-rule (13). Otherwise, it will be ultra vires the section." We are unable to agree to the meaning put by the High Court on section 5(6) of the Act. In our view, the expression "during the period of option permitted under this section at any time " does not refer to the power of the prescribed authority at all but it refers to the happening of the events enumerated in the sub-section that would form the basis to vary the fixed amount of tax. To make our meaning clear we may read sub-section (6), insofar as relevant for the present, in the following way: "Where, at any time during the period of option permit....