TaxTMI 
TaxTMI 
TaxTMI 
2022 (7) TMI 1595
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.... admission fees. On such entrance / admission fees petitioner would collect entertainment duty and pay the same to respondents under the provisions of the Bombay Entertainments Duty Act, 1923 (hereinafter referred to as "the said Act"). By year 2002, when the petition came to be filed, and we would say much earlier, mobile phone became a common means of communication and many people started carrying and using mobile phones. For professionals and businessmen, it became indespensable and one may say an extension of their office. For several years, petitioner did not allow the use of mobile phones at race course during race days and "Off course racing". But due to repeated requests from members and those non-members who were attending the races, petitioner decided to permit use of mobile phones at the race course. It was represented to petitioner that if use of mobile phones was permitted at the race courses, more people would be able to attend the races. This resulted in an increase in the collection of entertainment duty and the State stood to benefit. To restrict the nuisance being caused due to usage of mobile phone during the races, petitioner decided to levy a charge of Rs. 1,00....
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.... is primarily impugned in this petition. In this order, the basis on which government has decided to levy and collect entertainment tax on mobile phone charges collected by petitioner from patrons of races who wanted to carry mobile phone inside the racecourse during the races, is that the Government of Maharashtra has issued a G.R. dated 27.12.2001 wherein it was decided that the charges collected for carrying a mobile phone into the race course during a race are to be treated as payment for admission as defined in Section 2 (b)(iv) of the said Act and it was decided to levy entertainment duty in accordance with the provisions of section 3(i)(a) of the Act. The relevant portion of the impugned order reads as under : "The Government of Maharashtra in Revenue and Forests Departments have issued a Resolution dated 27.12.2001 wherein it was decided that the Mobile Phone charges in race days are to be treated a payment for admission as defined in Section 2(b)(iv) of the said Act and further it is decided to levy Entertainment Duty in accordance with the provisions of section 3(1)(a) of the said Act. Government of Maharashtra has directed the Collector, Mumbai City, to recover Enterta....
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.... with Article 14 of the Constitution of India; (v) In so far as the demand for period between 2001-2002, the Respondents have sought to levy entertainment duty under the impugned Government Resolution dated 27th December 2001 for the period commencing prior to the date of the said Government Resolution, i.e., the period commencing 21st January 2001. This tantamounts to retrospective levy, which is impermissible under the Constitution absent express authority of law. The direct effect of such retrospective action is that petitioner was not in a position to charge and recover entertainment duty on mobile phone charges from its members, i.e., the actual persons sought to be taxed, and this goes against the grain of indirect taxation and is manifestly arbitrary, unfair and unreasonable, thereby contrary to Article 14 of the Constitution of India. 8. Mr. Takke basically reiterated the stand taken by the State in the impugned orders. He also submitted that betting at the race course certainly is an entertainment because clause (a) of sub-section (1) in Section 3 of the said Act itself provides for rate of entertainment duty for admission to a race course licensed under the Bombay Ra....
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.... Section (2)(a) and (b)(iv) reads as under : "2(a). "entertainment" includes any exhibition, performance, amusement, game or sport to which persons are admitted for payment, [or, in the case of television exhibition with the aid of any type of antenna with a cable network attached to it or cable television, [or Direct to Home (DTH) Broadcasting Service] for which persons are required to make payment by way of contribution or subscription or installation and connection charges or any other charges collected in any manner whatsoever] [but does not include magic show) [and temporary amusement including games and rides]. 2 (b). "Payment for admission" [in relation to the levy of entertainment duty] includes, (iv) any payment, by whatever name called for any purpose whatsoever, connected with an entertainment, which a person is required to make, in any form as a condition of attending, or continuing to attend the entertainment, either in addition to the payment, if any, for admission to the entertainment or without any such payment for admissions. (emphasis supplied) xxxxxxxxxxxxxxxx 11. Therefore, Section 3 provides that there shall be levied and paid to the state government o....
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....ainment a person would get by taking his mobile phone into the race course. Entertainment is defined by section 2(a) and includes any exhibition, performance, amusement, game or sport to which persons are admitted for payment. Payment for admission is defined in section 2(b) to include various payments such as payment for seats or other accommodation in a place of entertainment. Sub-clause (iv) of section 2(b) provides any payment for any purpose whatsoever connected with an entertainment, which a person is required to make as a condition of attending, or continuing to attend the entertainment. On the facts of the present case, it is difficult to comprehend how a person who pays a charge to take his mobile phone into the race course is paying for being admitted to place where entertainment is being held. The term 'entertainment' as seen above includes any exhibition, performance, amusement, game or sport to which persons are admitted on payment. None of these elements exist when a person takes his mobile phone into the race course. There is no exhibition or amusement or game or sport enjoyed by a person taking his mobile phone into the race course. The amount charged by petitioner ....
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....d Act. Therefore, to the extent of the amounts paid for carrying the mobile phone into the races, it cannot be made subject to the payment of entertainment tax at the rates prescribed under the said Act. 15. We find support for this view in the judgment of the Hon'ble Gujarat High Court in Ramanlal B. Jariwala v/s District Magistrate, Surat and another (1990) SCC Online Guj. 135 and of the Madras High Court in PVR Ltd. v/s Commercial Tax Officer (2020) SCC Online Mad.27257, both relied upon by Mr. Mehta. Paragraph 4 of Ramanlal B. Jariwala (Supra) reads as under:- "We have heard the learned Advocates of the parties on this question. In our view, the submission made by the petitioner is well justified and has got to be accepted. The facts stated in the petition are not controverted by the respondents by filing any affidavit-in-reply. We must, therefore, proceed on the uncontroversial factual position, that the petitioner's cinema theatre which would be having auditorium and where cinema pictures-are exhibited is situated at a height of 35' from the ground floor and that auditorium can be approached after crossing the foyer on the first floor and thereafter crossing glass....
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....sement, game or sport to which persons are admitted for payment. 'Payment for admission' is defined by Section 2(g) to include various payments such as payment for seats or other accommodation in a place of entertainment. Especially, clause (v) of Section 2(g) is worth noting in this connection. It provides that any payment for any purpose whatsoever connected with an entertainment which a person is required to make as a condition of attending or continuing to attend the entertainment in addition to the payment, if any, for admission to the entertainment. On the facts of the present case, it is difficult to comprehend as to how a person who pays ten paise per upward trip in lift for approaching the cine auditorium on the first floor is paying for being admitted to a place where entertainment is held. The term 'entertainment' as seen above includes any exhibition, performance, amusement, game or sport to which persons are admitted for payment. None of these elements exists when a person travels in a lift. There is no exhibition, amusement or game or sport, enjoyed by a person traveling in lift. What is relevant is payment for being admitted to place of entertainment.....
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....that mere collecting of ten paise for getting extra facility of lift if required by any cinegoer would by itself bring this levy within the fold of the Act. The respondents were, therefore, patently in error in insisting that the petitioner should pay entertainment tax on the lift charges. collected by him, from the cinegoers who go to his cinema theatre. The learned Assistant Government Pleader could not show us how such type of levy can be sustained under the provisions of the Act. Consequently, it must be held that insistence of the respondents in calling upon the petitioner to pay entertainment tax on the lift charges on the facts of this case is totally illegal and without jurisdiction. The reasoning given in Annexure F for demanding entertainment tax on the basis of Section 2(g)(v) and 3(1)(k) is also patently illegal and ultra vires as these provisions do not cover such type of levy as seen earlier." (emphasis supplied) Paragraph 23 and 24 of the PVR Ltd (Supra) reads as under:- "23. In the case before us, the test for levy of Entertainment Tax is the entry into the entertainment and payment for that purpose. Entertainment Tax was a State subject and before the said lev....
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....provided to all on the Web portal of the cinema hall owners. Therefore, the words in the clause 3(7)(c) of the Act, " any payment for any purpose whatsoever connected with an entertainment ", in addition to the payment for any for admission to entertainment in clause "(c)", will have to be read in conjunction and not without the context of the words, " which a person is required (mandatorily) to make as a condition of attending or continuing to attend the entertainment" . These words are not superfluous or without meaning and in fact, they provide the bedrock condition for applying Section 3(7)(c) of the Act. Unless such a conditional payment for any purpose is integrally connected with the "entertainment" is uniformly and mandatorily chargeable from all, who want to have entry in the place of cinema hall, in our opinion, Section 3(7)(c) cannot cover such payment made by the customer, for availing the facility of online booking of tickets." (emphasis supplied) 16. Thus on the scheme of the relevant provisions of the Act, conclusion can be arrived that charging of the amount per person who carried the mobile phone into the race course is not payment received for admission to any ....