TaxTMI 
TaxTMI 
2024 (7) TMI 297
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Kerala Value Added Tax Appellate Tribunal on three issues that were decided against it by the Tribunal. Those issues are as follows: 1) Whether the charges received by the assessee from its customers out of the amounts paid to the Ayurveda Centre functioning in the premises of the hotel operated by it would attract the levy of luxury tax under the Kerala Tax on Luxuries Act? 2) Whether the charges received by the assessee from its customers out of the amounts paid to a Beauty Parlour functioning in the premises of the hotel operated by it would attract the levy of luxury tax under the Kerala Tax on Luxuries Act ? 3) Whether the charges collected by the assessee from clients/customers for the use by the latter of the Convention Centre operated by it would attract the levy of luxury tax under the Kerala Tax on Luxuries Act? 4. We find from a perusal of the orders of the Assessing Authority, First Appellate Authority and the Appellate Tribunal that the issues were decided against the assessee for all assessment years by the assessing authority at the first instance. In the appeals preferred before the First Appellate Authority, while the First Appellate Authority allowed the c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssessment years 2006-07 and 2007-08, the amendment introduced in the Kerala Finance Act, 2006 with effect from 01.07.2006 clearly brought the income from the Convention Centres within the ambit of the charge to luxury tax, for the prior period, covering assessment years 2004-05 and 2005-06, the said charges would have attracted the levy of luxury tax as applicable to Convention Centre on interpreting the provisions of Section 4(2)(c) of the Act in a manner that would include Convention Centres by applying of the principle of ejusdem generis. He places reliance on the decisions in Brunton Boatyard v. State of Kerala [2013 (4) KLT 37], State of Kerla v. M/s. Kumarakom Lake Resorts (P) Ltd. [2018/KER/45898 (W.P(C)No.9148 of 2009)] and New Horizons Limited and another v. Union of India [(1995) 1 SCC 478]. 6. Per contra, it is the submission of Sri. A Kumar, the learned Senior Counsel appearing on behalf of the respondent-assessee, duly assisted by Advocate Smt.G.Mini, that the scheme of the Act has been clearly delineated by a Division Bench of this Court in the decision reported in Madhavaraja Club v. Commercial Tax Officer (Luxury Tax) [2023 (3) KLT 475]. Going by the said decision,....
X X X X Extracts X X X X
X X X X Extracts X X X X
....v. Commercial Tax Officer, (Works Contract) & Another [(2012) 20 KTR 321 (Ker)], iv) Brunton Boatyard v. State of Kerala [(2013) 66 VST 533 (Ker.)] and v) Madhavaraja Club v. Commercial Tax Officer (Luxury Tax) [2023 (3) KLT 475]. 7. We have considered the rival submissions and we find that in a judgment rendered by one of us in Madhavaraja Club v. Commercial Tax Officer (Luxury Tax) [2023 (3) KLT 475] the scheme of taxation under the Kerala Tax on Luxuries Act was delineated as follows: "5. When construing the provisions of any taxing statute, it is useful to keep in mind the test that is often applied by courts to determine whether the tax in question is one that is backed by the authority of law viz., that for a levy to exist in point of law four components must exist-the nature of the tax which prescribes the taxable event, the person on whom the levy is to be imposed, the rate of the tax and the measure or value to which the rate will be applied (See: Govind Saran Ganga Sarana v. CST (1985 KLT Online 1248 (SC)=AIR 1985 SC 1041). The test, when applied, provides the answers to four cardinal questions viz. (i) what is taxable event or the event that attracts the tax....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the KTL Act therefore clearly reveals that it is a tax on the enjoyment of a luxury, that is attracted at a point in time when such luxury is provided by a 'proprietor' to another person for the latter's enjoyment. The incidence and levy of the tax is on the 'proprietor" although the ultimate impact of the tax may be on the persons who enjoys the luxury that is provided. The 'proprietor' is also the person who is made responsible under the Act to register himself, collect the tax from the person who enjoys the luxury, pay the applicable tax to the Government exchequer along with the filing of his returns and subject himself to an assessment under the Act." 8. When we consider the issues raised in these Original Petitions in the backdrop of the scheme of the Act as enunciated above, we find that in relation to the Ayurveda Centre and the Beauty Parlour, that are functioning in the premises of the assessee hotel, the documents perused by the authorities below clearly showed that the provision of the luxury was by the independent third persons and not directly by the assessee hotel. The invoices raised on the customers, for the services provided by the indep....