LexLIBERTY TALKIES & ORS. versus STATE OF GUJARAT
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
:398
LIBERTY TALKIES & ORS.
v.
STATE OF GUJARAT
January 21, 1971
{J.C. SHAH, CJ., K. S. HEGDE AND A. N. GROVER, JJ.]
Bombay Entertainments Duty Act (1 of 1923), ss. 3 and 4.and r. 7
of tlze Rules made thereunder-Scope of.
A
B
From March 1960 to January 1962 entertainment duty, was1 levied on
the appellants at the rates prescribed in s. 3 of the Bombay Entertainment
Duty Act, 1923, on the net price receivable by the proprietor of a theatre
and not on the total amount including entertainment duty collected from
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visitors.
Thereafter entertainment duty was levied on the aggregate of the
net value of the ticket and duty paid by the • visitors. The appellants
challenged the validity o'f the levy but the High Court dismissed their
petition.
Jn appeal to this Court,·
HELD: (1) Bys. 3 of the Act duty is leviable at the rates prescribed
D
on all payments for admission and the· method of levy is prescribed by s.
4. Under s. 4(1) on the ticket for admission to any. entertainment, an im-
pressed, einbossed, engraved or adhesive stamp issued by the State Govern-
ment of the value specified in s. 3 must 'be
affixed.
The definition of
'payment for admission' ins. 2(b)- includes payment for any purpose '"·hat·
soever connected with an entertainment which a person is required to make
as. a condition of attending. or continuing to attend the entertainment. The
price which the visito·r pays for a ticket for admission to the entertainment
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is thus the value uf the stamp affixed and the net value -0f the ticket. and
the proprietor of the theatre is therefore liable to pay entertainment duty
on the gross sum received from a visitor. r402 E, H; 403 A-~; 404 Dl
(2) The use of the expression "affixed to it a stamp of the value of
the duty payable out of the said price di admrssiori" "in rule 7 of the
rules framed under the Act does not support the view that the amount of
cntert.ainment duty represented by the ticket alone is payable by the pro-
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prietor. It only means that the proprietor shall specify on the ticket the
amount chargeable by him to the visitor. [403 :C-G]
( 3) !he proprietor thus passes on a part of the duty payable by him
to the VIS1to·r but he does not act as an agent of the,,GOvernment for col-
1ccting the duty, because. under ss. 3 and 4 tl}_e _liability for pavrncnt cf the
duty is in1posed upon the proprietor and not upon the viSitors to the
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theatre. [402 H; 403 BJ
( 4) A proprietor paying entertainment duty on the total amount re-
ceived by him lfrorri the visitor will never be able to col!ect the full amount
of entertainment duty from such visitor.
A part of the duty pavable b1·
him will haye to come ?lit of the amo.unt receiv~d ~y him as the net charge
for a ticket. But questions of hardship cannot 1ushfy a departure from the
provisions of ss. 3 and 4 o'f the Act The Legislature must be deemed to
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have contemplated that only a part of the entertainment duty l1evied by the
;'1-
Government must be collected from the visitors to the theatre and the
balance should be paid by the proprietor. [404 F-H]
•
LIBERTY TALKIES V. GUJARAT (Shah, C.J.)
399
A
(5) But the Act contains no provision for reopening assessments al-
ready made and the State cannot therefore reopen the concluded assessments
prior to January 1962. [405 Bl
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 416 to
426 of 1967.
8
Appeals by special leave from the judgment and order dated
November, 8, 9, 1968 of the Gujarat High Court in Special Civil
Applications Nos. 595, 634, 636, 693, 694, 695, 696, 771 of
1962, 57 and 128 of 1963 and 39 of 1964.
c
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G
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S. T. Desai, I. N. Shroff and M. N. Shroff. for the appellants
(in al! the appeals).
C. K. Daphtary, K. L. Hathi, B. D. Sharma for S. P. Nayar,
for the respondents (in all the appeals l.
The Judgment of the Court was delivered by
Shah, C. J.-Under the Bombay Entertainments Duty Act
1 of 1923 entertainment duty is chargeable on the total collections
from the visitors to a theatre. On March 18, 1960 the Collector,
Junagarh issued instructions to his subordinate officers directing
them to levy entertainment duty at the prescribed rate only on
the net price recetvable by the proprietor of the theatre and not
on the total amountlrrcluding entertainment duty collected from
the visitors. Entertainmeni'11ufy so computed was paid till Jan-
uary 1962 by the appellants who own a theatre at Junagadh.
On January 11, 1962 the GovExcerpt shown. Read the full judgment & AI analysis in Lexace.