The Kerala Tax on Luxuries in Hotels and Lodging Houses Act,1976 (No.32 of 1976)

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Sec tsons
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THE KERALA TAX ON LUXURIES IN HOTELS AND
Preamble.
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LODGING HOUSES ACT, 1976
(Act 32 of 1976)
CONTENTS
Short tltle, extent and commencement
Defimtxons
Authorlues
Levy and collectlon of luxuly tax
Returns
Assessment and collectlon of tax
Appeal
REVISIOH
Court fees
Recovery of unpald luxury tax
Scrv1ce of nouce
Power to Inspect and 1am: comes of IeCUl‘dS and
accounts
Power to order productlon of accounts and powers,
of entry, mspecuun, etc
Fewer to take evxdence on oath, etc
Refunds
lextatlon oi clalms for reiund
Penaltles
Offences by compames
Bar of Junsdlctlon
Power to make rules
Power to remove d1f’ficult1es
Repeal and sang.

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THE KERALA TAX ON LUXURIES IN HOTELS AND
LODGING HOUSES ACT, 1976’
(Act 32 of 1976)
An Act to provrde for the levy and collection of a tax on
luxuries provided in hotels and lodging houses
Preamble—WHEREAS 1t lS expedlent to pr0v1de for the
levy and collectlon of a tax on 1uxur1es prov1ded 1n hotels and
lodgmg houses,
BE 1t enacted 1n the Twenty-seventh Year of the Repub‘nc
of Indla as follows
—
1 Short title, extent and commencement.-—(1) ThIS Act
may be called the Kerala Tax on Luxurles 1n Hotels and
Lodgmg Houses Act, 1976
(2) It extends to the whole of the State of Kerala
(3) It shall be deemed to have come 1nto force on the
lst day 01 July, 1976
2 Definitions—In thls Act, unleSs the context otherwrse
requ1res,—
(a) ”appellate authorlty" means an appellate authority
appomted under sub—sectlon (2) of sectlon 3,
(b) ”assessmg authority” means an assessmg authonty
appomted under sub-sect1on (l) of sectlon 3,
(c) "Board of Revenue” means the Board of Revenue
const1tuted under the Kerala Board of Revenue Act. 1957,
(cl) "company" means a company as defined 1n scctlon d
of the Compames Act, 1956,
(e) ”hotel" means a bulldmg or part of a buzldmg where
resrdential accommodatlon 15 by way of business provided [or
a monetary con51derat10n and mcludes a lodgmg house
*
Renewed the assent of the Governor on the 11th day of November.
1976 and pubhshed 1n the Kemla Gazette Extrumdmary No 647.
dated 13th November, 1976

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Id.
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Explanation —A guest house run by the G0vernment or
a company or a corporation established by or under any law
or any other agency shall be deemed to be a hotel within the
meaning of this clause,
(f) "luxury prov1ded in a hotel“ means accommodation
for reSidence and other amenities and serVices prOVided in a
hotel, the rate of charges for which (exclusive of charges for
food, drink and telephone calls) is fifteen rupees per day Oi
more,
(g) "prescribed” means prescribed by rules made {inder
this Act,
(h) "proprietor”, in relation to a hotel, includes the
person who for the time being is in charge of the manage-
ment of the hotel
3 Authorities—(1) The Government may, by notification
in the Gazette, appomt such officers as they think fit to be
assessmg authorities for the purposes of this Act and may assigi.
to them such local limits as the Government may think fit
(2) The Government may, by notification in the Gazette,
appoint such officers as they think fit to be appellate authorities
for the purposes of this Act and may aSSign to them such local
limits as the Government may think fit
(3) All authorities and officers employed in the execution
of this Act shall observe and follow the orders, instructions
and directions of the Board of Revenue
Prov1ded that no such orders, instructions or directions
shall be given so as to interfere with the discretion of the
appellate authority in the exercise of its appellate functions,
4 Levy and collection of luxury tax.—(l) Subject to the
prOVismns of this Act, there shall be leVied and collected a tax
in respect of any luxury provided in a hotel (hereinafter called
the “luxury tax”).

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(2) The luxury tax shall be payable by the person
reSiding in a hotel, at the followmg rates, namely
'—
(a) Where the rate of charges for acco- Five per centum of
mmodation for residence and such rate
other amenities and services
(exclusive of charges for food,
drink and telephone calls) is
fifteen rupees or more but does
not exceed twenty-five rupees
per day per person
(b) Where such rate exceeds twenty- Seven and a half per
five rupees but does not exceed centum of such rate
fifty rupees per day per person
(c) Where such rate exceeds fifty rupees Ten pci ccntum of
per day per person such rate:
Prov1ded that where such charges me leVied otherwise
than on daily basis or per person, then, the charges for deter—
mining the liability to tax under this section shall be computed
as for a day and per person based on the period of occupation
of the resrdence for which the charges are made and the
number of persons actually occupying or permitted to occupy
according to the rules or custom of the hotel
(3) The luxury tax shall be collected by the proprietor
and paid Within such period and in such manner as may be
prescribed, into a Government treasury
(4) In computing the luxury tax, a fraction of a rupee
which is not a multiple of five paise shall be rounded off to the
next higher multiple of five paise
5 Returns —(1) Every proprietor liable to pay luxury
tax under this Act shall submit a return in the prescribed form
to the assessing authority Within eight days after the end of the
month to which the return relates
(2) Every such return shall show the number of rooms
or other accommodation in the hotel which is intended to be
occupied, the number of persons who occupied such rooms or
accommodation, the periods of their stay, the days of arrival
and departure, the amount of charges recovered from them
for accommodation and other amenities and serVices, together
With such other information as may be prescribed.

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(3) Every such return shall be accompanied by a receipt
for payment on Government account into a Government
treasury of the full amount of the luxury tax for the period to
which the return relates
(4) Every return shall be verified in the prescribed
manner
6 Assessment and collection of tax.—-(l) On receipt of
a return under section 5, the assessing' authority shall assess
the luxury tax payable in respect of the period to which the
return relates, and if the amount has not already been paid
as aforesaid, it shall cause a notice to be served upon the
proprietor concerned requiring him to pay the amount assessed
within ten days of the serVice of the notice
(2) If the proprietor fails to submit in due time the
return referred to in section 5, the assessing authority shall,
after giving him a reasonable opportunity of being heard, assess
to the best of its judgment, the amount of luxury tax payable
and the prOViSions of sub-section (1) in respect of notice shall
apply as if such assessment has been made on the basis of a
return furnished by such proprietor
(3) If the luxury tax 18 not paid Within the prescribed
period the assessing authority may levy a penalty equal to a
sum not exceeding the amount of the luxury tax payable under
this Act
Provided that no penalty shall be levied under this sub-
section unless the proprietor has been given a reasonable
opportunity of being heard
7 Appeal -—Any person aggrieved by an order of assess—
ment made or a penalty lev1ed under section 6 may, Within thirty
days from the date of receipt of the order, apply to the appellate
authority for the annulment or modification of the assessment
or penalty, and on such application. the appellate authority
may, subiect to such rules of precedure as may be prescribed,
confirm, annul or modify the assessment or penalty
8 RevisiOn.—-(1) The Board of Revenue may, either suo
motu or on application, call for and examine the record and
proceedings of any order made by the assessing authority and
pass such order thereon as it thanks just and proper.

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Provided that no application under this sub-section shall
be entertained if it is not made within a period of ninety days
from the date on which the order in question was received
by the applicant.
Provided further that before rejecting any application
under this sub—section, the Board of Revenue shall record
reasons for such I‘EIGCllOn
(2) No order shall be passed under sub-section (1)
which is likely to affect any person adversely, unless such
person has been given a reasonable opportunity of being heard
(3) Where a person could have appealed under section 7
and no appeal has been filed by him, no proceedings under this
section shall be entertained upon the appliCation of such person
9. Court fees.-—-Notw1thstanding anything contained in the
Kerala Court Fees and Suits Valuation Act, 1959 (10 of 1960},
an appeal preferred under section 7 or an application for revi-
Sion made under section 8 shall bear a court fee stamp of such
value as may be prescribed
10. Recovery of unpaid luxury tax—Any luxury tax or
penalty recoverable under this Act and remaining unpaid may
be recovered as an arrear of public revenue due on land
11 Service of notice—A notice under the prov1s10ns of
this Act may be served by post or by delivering or tendering
it to the person to whom it is addressed or to his agent or in
such other manner as may be prescribed
12 Power to inspect and take copies of records and
accounts.—-(1) The assessmg authority shall have access at
all reasonable times to :1 hotel or place of busmess of any
person liable to collect or pay the luxury tax under this Act
(2) The assessing authority may, at any time, with or
without notice to any perSOn referred to in sub-section (I),
examine his working records and accounts and take copies of,
or extracts from, any of the said records or accounts for pur-
poses of testing the accuracy of any return or for informing
itself as to the particulars regarding which information is
required for the purposes of this Act or any rule made there-
under,
Au.- 4.
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13. Power to order production of accounts and powers of
entry, inspection, etc.—(1) The assessing authority may, for
the purposes of this Act, by notice, require any proprietor—
(a) to produce or cause to be produced before it any
accounts, registers, records or other documents; or
(b) to furnish or cause to be fumished any \other
information relating to the hotel,
and such proprietor shall comply With such requisition.
(2) The assessing authority may, at any reasonable
time,——
.
(a) enter any hotel or place of busmess or any vehicle
or vessel of the proprietor, and
(b) inspect any accounts, registers, records or other
documents relating to his hotel or hotels
(3) If the assessmg authority has reasons to believe
that a proprietor is trying to evade the collection or payment
of the luxury tax, it may, for reasons to be recorded, enter
and search—
(a) any hotel or place of business of the proprietor; or
(b) any other place where the proprietor is keeping
or is reasonably believed to be keeping any accounts, registers,
records or other documents relating to his hotel or hotels
Provided that no residential accommodation (not being
a hotel-cum-resrdence) shall be entered mto or searched, unless
the assessing authority 15 specially authorised in writing by the
Board of Revenue to search that accommodation
Explanation —-For the purposes of clause (b), ‘place’
includes any godown, building, vessel, vehicle, box or receptacle.
(4) All searches under this section shall, so far as may
be, be made in accordance with the prowsions of the Code of
Criminal Procedure, 1973 (Central Act 2 of 1974)
(5) The assessing authority making the inspection or
search may seize such accounts, registers, records or other
documents as it considers necessary, and on such seizure shall
grant the proprietor a receipt of the things seized.
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(6) The accounts, registers, records or other documents
seized under sub-section (5) shall not be retained by the assess—
ing authority beyond a period of thirty days from the date
of seizure except with the permission of such authority as may
be specified by the Government in this behalf, unless they are
required for any prosecution under this Act
'
Provided that the authority spec1fied by the Government
under this sub-section shall not give permission to retain such
accounts, registers, records or other documents beyond a period
of forty-five days from the date of the seizure
(7) The power conferred by sub-sections (3) and (5)
shall include—
(a) the power to break open any box or receptacle or
place or the door of any premises in which any accounts,
registers, records or other documents of the proprietor are
reasonable believed to be kept:
Provided that the power to break open the door of any
premises shall be exercised only after the owner or any other
person in occupation of the premises fails or refuses to open
the door on being called upon to do so;
(b) the power to seal any box or receptacle, godown
or building, where any accounts, registers, records or other
documents are or are reasonably believed to be kept, if the
owner or any other person in occupation leaves the premises
or refuses to open the box or receptacle, godown or building,
or is not available, and then to break open such box, receptacle,
godown or building, on the authority of an authorisation in
writing by the Board of Revenue,
(c) the power to search any person who has got out of,
or is about to get into, or is in. any place referred to in clause (a)
or clause (b) of sub—section (3) or any vessel or vehicle of any
proprietor, if the assessing authority has reasons to suspect
that such person has secreted about his person any accounts,
registers, records or other documents
14 Power to take evidence on oath, etc.—The assessing
authority, the appellate authority and the Board of Revenue
shall, for the purposes of this Act, have the same powers as
at
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169
are vested in a civil court under the Code of Civil Procedure,
1908 (Central Act 5 of 1908), when trying a suit, in respect
of the following matters, namely:—
(a) enforcing the attendance of any person and
examining him on oath or affirmation,
(b) requiring the discovery and production of docu-
ments;
(c) receiving evidence on affidaVIt;
(d) issuing commissions for the examination of
witnesses,
15. Refunds—(1) If any proprietor satisfies the assessing
authority that the amount of the luxury tax paid by him
exceeds the amount of such tax payable by him under this
Act, he shall be entitled to a refund of such excess
(2) The appellate authority in the exercise of its appel-
late pOWers or the Board of Revenue in the exermse of its
revisional powers, it satisfied to the like effect, shall cause a
refund to be made by the assessing authority of any amount
found to have been wrongly paid or paid in excess.
16. Limitation of claims {01- refund.—No claim to any
refund of the luxury tax under section 15 shall be admitted,
unless it is made within three years from the date of the order
of assessment or, where an appeal has been preferred or where
there has been a reVision, within three years from the date
of the order in appeal or revision, as the case may be.
17. Penalties—(1) Any person who—
(a) knowingly submits an untrue‘ return or fails to
submit a return as required by this Act or the rules made there-
under; or
(b) wilfully acts in contravention of any of the pro-
visions of this Act or the rules made thereunder for the contra-
vention of which no express provision for punishment is made
by this Act,
shall be punishable with fine which may extend to one thousand
rupees
3/97—l2a.

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(2) Any person who—
(a) prevents or obstructs inspection, entry, search or
seizure by the assessing authority, or
(b) fraudulently evades the payment of luxury tax or
other amount due from him under this Act,
shall be punishable with imprisonment for a term which may
extend to Six months, or wrth fine which may extend to one
thousand rupees, or with both
(3) A person shall not be proceeded against under this
section except at the instance of the assessing authority
18 Offences by companies.—(1) Where an offence under
this Act has been committed by a company, every person who
at the time the offence was committed was in charge of, and'
was responsible to, the company for the conduct of the business
of the company. as well as the company, shall be deemed to
be guilty of the offence and shall be liable to be proceeded
against and punished accordingly:
Provided that nothing contained in this sub-section shall
render any such person liable to any punishment, if he proves
that the offence was committed without his knowledge or that
he had exercised all due diligence to prevent the commission
of such offence
(2) Notwithstanding anything contained in sub-section (1),
where any offence under this Act has been committed by a
company and it is proved that the offence has been committed
with the consent or connivance of, or is attributable to any
neglect on the part of, any director, manager, secretary or
other officer of the company, such director, manager, secretary,
or other officer shall be deemed to be guilty of that offence
and shall be liable to be proceeded against and punished accord-
ingly v ”
Explanation—For the purposes of this section,—
(a) "company” means any body corporate and includes
a firm or other association of individuals. and
(b) ”director", in relation to a firm, means a partner
in the firm.
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19 Bar of Jurisdiction —-No su1t Shall 11e 111 any C1v11 court
to set a51de or modify any assessment made under this Act
and no prosecutmn, suit or other legal proceeding shall he
against the Government or any authority or officer for any—
thing 1n good faith done or intended to be done under th1s Act.
20 Power to make rules.—(1) The Government may, by
notification in the Gazette, make rules for carrymg into effect
the prov1510ns of this Act
(2) In particular. and w1thout preJudlce to the generality
of the foregomg power, such rules may prov1de for all or any
of the followmg matters, namely
—-
(a) the form 1n which returns shall be submitted under
section 5, further information to be furmshed with the returns
and the manner 1n which the returns shall be verified,
(b) the form of notice .to be served under section 6
and the procedure to be followed for assessment and collect1on
of the assessed dues,
(c) the procedure to be followed by the appellate
authorities ,
(d) the value of court fee stamp on an appeal or
appl1cation for revision;
(e) the other manner m which a notice may be served;
(f) the procedure for inspection and taking copies of
records and accounts;
(g) the fees to be paid for any of the matters provided
1n this Act; and
(h) any other matter which has to be, or may be,
prescribed
(3) Every 1ule made under this section shall be laid,
as soon as may be after it is made, before the Legislative
Assembly, while it is in session, for a total period of thirty days,
which may be comprised in one sessmn or in two successrve
sessmns, and if, before the expiry of the sessron in which it is
so laid or the sess1on immediately following, the Legislative
Assembly makes any modlfication 1n the rule or decides that
the rule should not be made, the rule shall thereafter have
effect only in- such modified form or be of no effect, as the case
may be; so however that any such modification or annulment
shall be Without prejudice to the validity of anything previously
done under that rule. ,

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21 Power to remove difiiculties.—If any difficulty arises
in giving efl‘ect to the provisrons of this Act, the Government
may, as occasion may require, by order do anything not incon—
sistent with the prowsmns of thls Act which appears to them
necessary for the purpose of removing the difficulty.
22. Repeal and saving —(1) The Kerala Tax on Luxuries
in Hotels and Lodging Houses Ordinance, 1976 (5 of 1976), is
hereby repealed.
(2) Notwithstanding such repeal, anything done or any
action taken under the said Ordinance shall be deemed to have
been done or taken under this Act.

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