LexThe Kerala Local Authorities Entertainments Tax Act 1961
Kerala · state statute
Open in Lexace · Ask the AI about this actACT 20 OF 1961
THE KERALA LOCAL AUTHORITIES ENTERTAINMENTS
TAX ACT, 1961
CONTENTS
Preamble.
Sections.
1. Short title, extent and commencement.
2. Definitions.
3. General provisions regarding the levy of the tax and the rate of tax.
3A. Entertainment tax on seating capacity
3B. Entertainment tax for amusement parks.
3C. Levy and collection of cess.
4. Composition and consolidated payment of tax.
5. Admission of persons to entertainments subject to tax.
6. Manner of payment of tax.
6A. Entertainments tax on dramatic and circus perf ormances.
7. Entertainment exempted from payment of tax.
7A. Power to exempt.
8. Manner of recovery of tax and fines under the Act.
9. Inspection by Local Authority.
10. Penalty for non-payment of tax.
11. Power of the Government to make rules.
12. Power of Local Authority to make bye-laws.
13. Repeal and Savings.
ACT 20 OF 1961
THE KERALA LOCAL AUTHORITIES ENTERTAINMENTS
TAX ACT, 1961*
An Act to unify and amend the law relating to the imposition and collection of taxes on
amusements and other entertainments in the State of Kerala.
Preamble.—WHEREAS it is expedient to unify and amend the law relating to the
imposition and collection of taxes on amusements and other entertainments in the State
of Kerala;
BE it enacted in the Twelfth Year of the Republic of India as follows:—
1. Short title, extent and commencement.— (1) This Act may be called the Kerala
Local Authorities Entertainments Tax Act, 1961.
(2) It extends to the whole of the State of Kerala.
(3) It shall come into force on such date as the Government may, by
1notification in the Gazette, appoint.
2. Definitions. —In this Act, unless the context otherwise requires —
(1) ‘admission’ includes admission as a spectator or as one of an audience and
admission for the purpose of amusement by taking part in an entertainment;
(2) ‘admission to an entertainment’ includes admission to any place in which
the entertainment is held;
(3) ‘agriculture’ includes horticulture and breeding of animals of every description;
(4) ‘entertainment’ includes any exhibition, performance, amusement, game,
sport or race to which persons are admitted for pay ment 2[but does not include any
magic performance];
(5) 'institution' includes a company, socie ty, club or other assoc iation of persons
by whatever name called;
3[(6) “Local authority” means a village panchayat constituted under section 4 of the
Kerala Panchayat Raj Act, 1994 (13 of 1994) or a municipality constituted under section 4 of
the Kerala Municipality Act, 1994 (20 of 1994).];
* Received the assent of the Governor on the 1 st day of July, 1961 and published in the Kerala Gazette
Extraordinary No.81 dated 3 rd July, 1961.
1 S.R.O. No.90/62 dated 22.03.1962 published in the Kerala Gazette Exraordinary No.72 dated 23.03.1962
(w.e.f. 01.04.1962).
2 Inserted by Act 33 of 1969 (w.e.f 01-11-1969).
3 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
(7) 1[“payment for admission” means—
(a) the price for admission, and
(b) any payment for any purpose whatsoever connected with an entertainment
(including any tax) which a person is required to make as a condution for
attending or continuing to attend the entertainment in addition to the price for
admission;
(7A) "price for admission" means the cost of a ticket (excluding any tax) for a
seat or other accommodation in a place of entertainment and includes in respect of any
person who, having been admitted to one part of a place of entertainment, is
subsequently admitted to another part thereof for admission to which a higher payment is
required;]
(8) 'proprietor' in relation to any entertainment includes any person responsible for
the management thereof.
2[3. General provision regarding the levy of tax and the rate of tax.—Any local authority
may levy a tax (hereinafter referred to as the entertain ments tax) at a rate 3[not less than
twenty four per cent and not more than forty eight per cent] on each price for admission
to any entertainment.]
4[Provided that in the case of admission to cinema, the entertainment tax shall be
at a rate not exceeding ten per cent on each price for admission to cinema.]
5[6[Provided further that] the rate thus fixed shall not be lower than the sum of
the entertainment tax levied under this section and additional tax on entertainment
levied under the Kerala Additional Tax on Entertainment and Surcharge on Show Tax
Act, 1963 (22 of 1963) prevailing in the area prior to the date of commencement of the
Kerala Decentralisation of Powers Act, 2000.]
7[3A. Entertainment tax on seating capacity .— Notwithstanding anything
contained in sections 3 and 4, a local authority may levy entertainment tax based on
seating capacity in the manner prescribed.]
8[3B. Entertainment tax for amusement parks. —(1) Notwithstanding anything
contained in sections 3, 3A and 4 and subject to such rules as may be made by Government in
this behalf, a proprietor of an amusement park shall pay an annual entertainment tax fixed by
the local authority within the range of rates specified against each category, namely.—
1 Substituted by Act 19 of 1975 (w.e.f 01-08-1975).
2 Substituted by Act 19 of 1975 (w.e.f 01-08-1975).
3 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
4 Inserted by Act 5 of 2019 (w.e.f 01-04-2019).
5 Inserted by Act 16 of 2000 (w.e.f 12-05-2000).
6 Substituted by Act 5 of 2019 (w.e.f 01-04-2019).
7 Inserted by Act 16 of 2000 (w.e.f 12-05-2000).
8 Inserted by Act 26 of 2005 (w.e.f 01-04-1999).
Category Range of rates of entertainment tax
to be fixed by the local authority
(1) (2)
CATEGORY A
Amusement park having an investment up to
Rs. 3 crores and having area to an extent of 2
hectares and below (excluding the area
provided for parking vehicles and other
unutilized/vacant area)
Rs. 3 to 6 lakhs
CATEGORY B
Amusement park having an investment of
above Rs. 3 crores but below Rs. 10 crores and
having area to an extent of above 2 hectares
but below 4 hectares (excluding the area
provided for parking vehicles and other
unutilized/vacant area)
Rs. 10 to 15 lakhs
CATEGORY C
Amusement park having an investment of Rs.
10 crores and above but below Rs. 20 crores
and having area to an extent of 4 hectares and
above but below 6 hectares (excluding the area
provided for parking vehicles and other
unutilized/vacant area)
Rs. 25 to 30 lakhs
CATEGORY D
Amusement park having an investment of Rs.
20 crores and above but below Rs. 50 crores
and having area to an extent of 6 hectares and
above but below 10 hectares (excluding the
area provided for parking vehicles and other
unutilized/vacant area)
Rs. 50 to 60 lakhs
CATEGORY E
Amusement park having an investment
of Rs. 50 crores and above and having area to
an extent of 10 hectares and above (excluding
the area provided for parking vehicles and other
unutilized/ vacant area)
Rs. 80 to 100 lakhs
Provided that during the first four-year period of operation of an amusement
park, the annual entertainment tax leviable shall be relaxed at the following rates, namely—
Period Relaxation of rate of
entertainments tax
(a) First year
(b) Second year
(c) Third year
(d) Fourth year
Sixty per cent
Forty per cent
Twenty per cent
Ten per cent.
Provided further that the local authority may permit the proprietor of an
amusement park to pay the entertainment tax in equated monthly instalments.
Explanation 1: Amusement park means a permanent out door facility set up for
entertainment which may include structures and buildings where admission is based on payment.
Explanation 2: For the purpose of this section, in categorizing the amusement
park, if both the investment and area of land do not come under any of the above categories, but
either the investment or the area comes under any one of the categories, the amusement park
shall be assessed in the category to which the higher rate of tax is applicable.
(2) (a) The Government may by notification in the Gazette constitute a committee for
the purpose of categorisation of the amusement parks, ensuring the safety of parks and to advise
the Government for review of the tax structure every three years.
(b) The Committee shall consist of—
(i) The Secretary to Government, Local Self Government Department —
(Urban) —ex-officio;
(ii) The Secretary to Government, Local Self Government Department
(Rural)—ex-officio;
(iii) The Secretary to Government, Finance (Expenditure)—ex-officio;
(iv) The Secretary to Government, Tourism—ex-officio;
(v) Chair Person, Mayors' Chamber;
(vi) Chair Person, Municipal Chairpersons' Chamber;
(vii) President, Kerala Grama Panchayath Association;
(viii) Chief Town Planner.
(c) The Committee shall exercise such other functions as may be specifically
authorised in this behalf.]
1[3C. Levy and collection of cess .—(1) There shall be levied and collected a cess
for the purposes of the Kerala Cultural Activists' Welfare Fund constituted under the
Kerala Cultural Activists' Welfare Fund Act, 2010 (6 of 2011) at such rate not exceeding
three rupees on each admission to cinema, the price of admission to which exceed twenty
five rupees, as the Government may, by notification in the Gazette, specify, from time to
time.
(2) The cess levied under sub-section (1) shall be collected by the local
authority along with the tax on each price for admission to cinema and the proceeds of
the cess, less collection charges at such rate as may be specified by the Government, by
notification in the Gazette from time to time shall be paid to the Kerala Cultural
Activists' Welfare Fund Board constituted under the Kerala Cultural Activists' Welfare
Fund Act, 2010.
(3) The proceeds of the cess collected under sub-section (2) for each calendar
month shall be remitted by the Secretary of the local authority to the account of the
Kerala Cultural Activists' Welfare Fund Board on or before the last working day of the
succeeding month.
(4) Where the proceeds of the cess collected by the local authority is not paid
within the time limit specified in sub-section (3), the local authority concerned shall pay
the said amount to the Kerala Cultural Activists' Welfare Fund Board together with
penalty at the rate of one and a half per cent per mensum from the said time limit.
(5) The Secretary and the President or the Chairperson of the local authority
concerned shall be jointly responsible for all belated payments and any amount paid to
the Kerala Cultural Activists' Welfare Fund Board by way of penalty shall be realised
from such Secretary and President or Chairperson of the local authority.
(6) The provisions of sections 5, 6, 7, 7A and sections 8 to 10 shall apply in
respect of cess on tickets for admission to cinema and the word 'tax' therein shall be
construed as to include ‘cess’ also.]
4. Composition and consolidated payment of tax.—On the application of the
proprietor of any entertainment in respect of which the entertain ments tax is payable
under section 3, the local authority may, subject to such rules as may be made by the
Government in this behalf, com pound the tax payable in respect of such entertainment
for a consolidated payment.
5. Admission of persons to entertainments subject to tax.— (1) Save in the cases
referred to in section 4 2[and section 6A ], no person shall be admitted for payment to
1 Inserted by Act 21 of 2013 (w.e.f 25-11-2012).
2 Inserted by Act 33 of 1969 (w.e.f 01-11-1969).
any entertainment 1[where the price for admission is subject to entertain ments tax ],
except—
(a) with a ticket stamped with an impressed, embossed, engraved or adhesive
stamp issued by the local authority indicating the proper tax for such ticket; or
2[(aa) with a ticket in the electronic form, indicating the proper tax for such
ticket, generated out of an electronic device with an application software approved by the
Government, having the facility for access and verification of any data or information in
respect of the tax due to the local authority as and when required by any officer
authorised by the local authority; or]
(b) in special cases, with the approval of the local authority, through a
barrier which, or by means of a mechanical contrivance which, automatically
registers the number of persons admitted,
unless the proprietor of the entertainment has made arrangements approved by the
local authority for furnishing returns of the payments for admission to the
entertainment and has given security approved by the local authority for the payment
of the entertainments tax.
3[Provided that the Government may, by notification in the Gazette, specify that the
admission to any class or classes of entertainments or to any place or places where an
entertainment is held, shall be made only with a ticket under clause (aa) of sub-section
(1) and thereupon no ticket under clause (a) shall be issued for admission to such
entertainment;]
(2) Nothing contained in sub-section (1) shall be deemed to pre clude the
local authority from requiring security from the proprietor of an entertainment for the
payment of the entertainments tax in any other case.
4[(3) For the purpose of installing the electronic devices with the hardware and
application software required for generating the tickets in the electronic form as provided
in clause (aa) of sub-section (1) and for the maintenance of such devices, an amount at
such rate and in such manner as may be specified in the rules made by the Government
shall be levied and collected towards service charges along with the ticket.]
6. Manner of payment of tax. —(1) The entertainments tax shall be levied in
respect of each person admitted for payment, and in the case of admission by ticket,
shall be paid by means of a ticket referred to in clause (a ) 5[or clause (aa)] of sub-
section (1) of section 5, and in the case of admission otherwise than by ticket, shall be
calculated and paid on the number of admissions.
1 Substituted by Act 19 of 1975(w.e.f 01-08-1975).
2 Inserted by Act 21 of 2013 (w.e.f 25-11-2012).
3 Added by Act 21 of 2013 (w.e.f 25-11-2012).
4 Inserted by Act 21 of 2013(w.e.f 25-11-2012).
5 Inserted by Act 21 of 2013 (w.e.f 25-11-2012).
(2) The entertainments tax in the case of admission otherwise than by ticket
shall be recoverable from the proprietor.
(3) Where the 1[payment of the price for admission] to an entertainment is made
wholly or partly by means of a lump sum paid as a subscription or contribution to
any institution, or for a season ticket or for the right of admission to a series of
entertainments or to any entertainment during a certain period of time, the
entertainments tax shall be paid on the amount of the lump sum, but where the local
authority is of the opinion that the payment of a lump sum or any payment for a ticket
represents payment for other privileges, rights or purposes besides the admission to an
entertainment or covers admission to an entertainment during any period during which
the tax has not been in operation, the tax shall be levied on such amount as appears to
the local authority to represent the right of admission to entertainments in respect of
which the entertainments tax is payable.
2[(4) Notwithstanding anything contained in the Kerala Cinemas (Regulation)
Act, 1958 (32 of 1958) or in the Kerala Panchayat Raj Act, 1994 (13 of 1994) or in the
Kerala Municipality Act, 1994 (20 of 1994), no licence or permit for conducting a
cinema theatre and exhibition thereof shall be renewed by the local authority concerned
unless the proprietor of such theatre has remitted the entertainment tax due up to the
preceding month.]
3[6A. Entertainments tax on dramatic and circus perf ormances. —(1)
Notwithstanding anything contained in sections 3 and 6, the entertainments tax leviable
by a local authority—
(a) on dramatic performances to which persons are admitted for payment shall
be 4[hundred rupees] on each performance, and
(b) on circus performances to which persons are admitted for payment shall be
5[sixty rupees] on each performance.
(2) The tax referred to in sub-section (1) shall be recoverable from the proprietor
of the dramatic performance or circus performance, as the case may be.
Explanation.—For the purposes of this section, the expression "dramatic
performance" means any play , pantomime or other drama.]
7. Entertainment exempted from payment of tax.— (1) The entertainments tax shall
not be levied 6[on the price for admission] to any entertainment where the local authority
is satisfied—
1 Substituted by Act 19 of 1975 (w.e.f 01-08-1975).
2 Inserted by Act 21 of 2013 (w.e.f 25-11-2012).
3 Inserted by Act 33 of 1969 (w.e.f 01-11-1969).
4 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
5 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
6 Substituted by Act 19 of 1975 (w.e.f 01-08-1975).
(a) that the entertainment is of a wholly educational character ; or
(b) that the entertainment is provided for purposes which are wholly or partly
educational, cultural or scientific by an institution not conducted or established for
profit; or
(c) that the entertainment is provided by an institution not conducted for
profit and established solely for the purposes of promoting public health or the interests of
agriculture or a manufacturing industry, and which consists solely of an exhibition of
articles which are of material interest in connection with questions relating to public
health or agriculture, or of the products of the industry for promoting the interests of
which the institution exists or of the materials, machinery, appliances or food stuffs used
in the production of those products ; or
(d) that the whole or the net proceeds of the entertainment is devoted to
philanthropic, religious or charitable purposes.
1[XXX]
2[XXX]
3[7A. Power to exempt. —(1) Notwithstanding anything contained in this
Act, the Gover nment may, by general or special order and for reasons to be
specified in such order exempt from liability to tax,—
(a) any entertainment or class of entertainments; or
(b) any or all of the entertainments provided in a place owned by the
Government or a Corporation owned or controlled by the Government.
(2) Any local authority concerned shall be bound to comply with any
order made by the Government under sub-section (1).
(3) A local authority may with the previous sanction of the Govern ment,
exempt any entertainment or class of entertainments not exempted under sub-
section (1) from liability to the tax.]
8. Manner of recovery of tax and fines under the Act.— (1) Any amount due on
account of the entertainments tax may be recovered by the local authority in the same
manner as any tax payable to the local authority.
(2) Any fine imposed under this Act or rules or bye-laws made thereunder
shall be recovered in the manner provided in the Code of Criminal Procedure,1898, for
the recovery of fines and shall on recovery be paid to the local authority concerned to be
applied for the general purposes of such authority.
1 Sub- section (2) omitted by Act 16 of 2000 (w.e.f 12-05-2000).
2 Sub- section (3) omitted by Act 4 of 1989 (w.e.f 11-11-1988).
3 Inserted by Act 4 of 1989 (w.e.f 11-11-1988).
9. Inspection by Local Authority. —(1) 1[The Director of Municipal Administration
or the Director of Panchayats or the Mayor of a Corporation or the 2[Chairperson of the
municipality or President of the village panchayat] or any officer authorised by the
2[Government] or the local authority concerned or any police officer authorised by the
Government in this behalf] may enter any place of entertainment while the entertainment
is proceeding and any place ordinarily used as a place of entertainment at any reasonable
time, with a view to seeing whether the provisions of this Act or any rules made
thereunder are being complied with.
(2) If any person prevents or obstructs the entry of 3[any officer authorised by or
under sub-section (1)], he shall, in addition to any other punishment to which he is
liable under any law for the time being in force, be liable on convic tion before a
Magistrate to a fine not exceeding 4[two thousand rupees].
(3) 5[Every officer authorised by or under sub-section (1)] shall be deemed to be
a public servant within the meaning of section 21 of the Indian Penal Code.
10. Penalty for non-payment of tax.—(1) If any person is admitted for payment to any
place of entertainment and the provisions of section 5 are not complied with, the
proprietor of the entertainment to which such person is admitted shall, on conviction by
a Magistrate, be liable in respect of each such offence to a fine not exceeding 6[two
thousand rupees] and shall in addition be liable to pay any tax 7[including escaped tax]
which should have been paid.
(2) Without prejudice to the provisions of sub-section (1) 8[any officer
authorised by or under sub-section (1) of section 9] may enter any place of
entertainment while the entertainment is proceeding, and any place ordinarily used
as a place of entertainment at any reasonable time, and if satisfied that the
provisions of section 5 are not complied with, by order in writing prevent the
further use of such place for the purposes of any entertainment:
Provided that before preventing the further use of the place for the purpose
of the entertainment the proprietor of the entertainment shall be given a reasonable
opportunity to show cause against the proposed action.
(3) If the order under sub-section (2) is not complied with, the officer
may request the officer in charge of the police station having jurisdiction over the
place to prevent the further use of such place for the purpose of any entertainment
and the officer in charge of the police station shall be bound to comply with the
request.
1 Substituted by Act 14 of 1987 (w.e.f 14-07-1987).
2 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
3 Substituted by Act 14 of 1987 (w.e.f 14-07-1987).
4 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
5 Substituted by Act 14 of 1987 (w.e.f 14-07-1987).
6 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
7 Inserted by Act 16 of 2000 (w.e.f 12-05-2000).
8 Substituted by Act 14 of 1987 (w.e.f 14-07-1987).
1[Explanation. —The term “escaped tax” shall mean and include any amount
of tax detected or revealed to have been not paid or to have escaped assessment
on a verification by the licensing authority or an authorised officer and calculated
or assessed with details collected during his inspection or enquiry. Such
assessment shall be presumed to be correct unless the assessee produces
sufficient proof to rebut the calculation of the escaped tax.]
11. Power of the Government to make rules.— (l) The Government may make
rules to carry out all or any of the purposes of this Act, not in consistent therewith.
(2) In particular and without prejudice to the generality of the foregoing
power they may make rules—
(a) for the composition and consolidated payment of tax under section 4;
and
(b) for the presentation and disposal of applications for exemption from
payment of the entertainments tax;
2[(c) for the fixation of the rate of service charges and the manner in which it is
to be collected and paid towards installation and maintenance of hardware and software
applications for generating tickets in the electronic form under sub-section (3) of section
5.]
(3) In making any rules the Government may provide that a breach
thereof shall be punishable with fine which may extend to one hundred rupees.
(4) All rules made under this Act shall be laid for not less than fourteen
days before the Legislative Assembly, as soon as possible after they are made and
shall be subject to such modification whether by way of repeal or amendment, as
the Legislative Assembly may make during the session in which they are so laid or
the session immediately followi ng.
12. Power of Local Authority to make bye-laws. —(1) Any local author ity may
make bye-laws not inconsistent with this Act or any rules made thereunder—
(a) for the supply and use of labels or stamped or embossed tickets or
for the stamping or embossing of tickets sent to be stamped or embossed and for
securing the defacement of labels when used;
(b) for the use of tickets covering the admission of more than one person
and the calculation of the tax thereon and for the payment of the tax on the
transfer from one part of a place of entertainment to another and on payment for
seats or other accommodation;
1 Inserted by Act 16 of 2000 (w.e.f 12-05-2000).
2 Inserted by Act 21 of 2013 (w.e.f 25-11-2012).
(c) for controlling the use of barriers or mechanical contrivances
(including the prevention of the use of the same barrier or mechanical contrivance
for payments of a different amount) and for securing proper records of admission by
means of barriers or mechanical contrivances;
(d) for the checking of admissions, the keeping of accounts and furnishing of
returns by the proprietors of entertainments to which the provisions of section 4 are
applied or in respect of which the arrangem ents approved by the local authority for
furnishing returns are made under section 5;
(e) for the renewal of damaged or spoiled labels;
(f) for the keeping of accounts of all labels used under this Act;
(g) for the regulation of the time and place of holding an enter tainment and
supervision thereof ;
(h) for the regulation of the time and mode of collecting the tax under
this Act; and
(i) in general, for carrying out the purposes of this Act.
(2) In making a bye-law, the local authority may provide, that a breach thereof
shall be punishable with fine which may extend to fifty rupees and in case of a
continuing breach with fine which may extend to fifteen rupees for every day during
which the breach continues after conviction for the first breach.
(3) All such bye-laws shall have effect when they have been approved by
the 1[the Government or any officer authorised by the Government] in that behalf
and published in the Gazette. 2[XXX]
3[XXX]
13. Repeal and Savings.—The Travancore-Cochin Local Authorities Entertainments
Tax Act, 1951 (Act VI of 1951) and the Madras Entertainments Tax Act, 1939 (Act X of
1939) as in force in the Malabar District referred to in sub–section (2) of section 5 of the
States Reorganisation Act, 1956 (Central Act 37 of 1956) are hereby repealed:
Provided that any notification, order, rule or bye-law issued or made under the
repealed Acts, shall, so far as it is not inconsistent with the provisions of this Act,
continue in force and be deemed to have been made or issued under the provisions
of this Act, unless and until it is superseded by any notification, order, rule or bye-
law made or issued under this Act.
1 Substituted by Act 16 of 2000 (w.e.f 12-05-2000).
2 Omitted by Act 16 of 2000 (w.e.f 12-05-2000).
3 Explanation to sub-section (3) of section 12 (Inserted by Act 15 of 1962) omitted by Act 16 of 2000 (w.e.f
12-05-2000).