Kohinoor Exhibitor (P) Ltd. Vs. the State of Rajasthan and ors. - Court Judgment

Excerpt:
- - the request was thus declined vide order dated 26-12-1992. this order was endorsed to the commercial taxes officers with a direction that if he amount has not been deposited the same may be recovered as arrears of land revenue. i am not prepared to accept this argument as in the given situation it may hold good.orderp.k. palli, j.1. these writ petitions raise common question of fact and law and thus are proposed to be disposed of by a common order. the facts are taken from s. b. civil writ petition no. 297/1993.2. the petitioner is running a cinema in the city of jodhpur known as kohinoor cinema. the state of rajasthan enacted an act known as rajasthan entertainments & advertisements tax act, 1957 (for short 'the act) and under section 4 of the act tax is leviable at the rate not exceeding 100% of the payment for purposes of admission which is popularly called as entertainment tax. this tax is leviable even on complimentary ticket which is issued by the proprietor. section 5 of the act lays down the manner in which the payment of tax is to be made and is to be calculated depending upon the number of admission. section 5b deals with the assessment. section 5c deals with re-assessment and section 6 of the act deals with admission to entertainments and lays down that no person other than a person who has to perform some duty in connection with an entertainment imposed upon him by any law or otherwise shall be admitted for payment to an entertainments tax except with a ticket stamped with an impressed, embossed, engraved or adhesive stamp not used earlier issued by the state government for the purpose of revenue. it is also laid down that the proprietor shall not admit any person without payment for admission thereof except in accordance with the prescribed conditions.3. next comes sub-section (3) of section 6, which provides that the government may on the application of the proprietor allow such proprietor on such condition as may be prescribed -- (a) to compound the tax payable in respect of such entertainment for a fixed sum, or (b) to pay the amount of the tax due -- (i) by a consolidated payment of such percentage of the gross sum received by the proprietor or on account of payments for admission to the entertainment and on account of the tax, as the state government may fix, or (ii) in accordance with returns of the payments for admission to the entertainment and on account of the tax, or (iii) in accordance with the results recorded by any mechanical contrivance which automatically registers the number of persons admitted. the petitioner has placed on record annx. 1, which is a scheme that has been introduced by the government for composition of entertainments tax under sub-section (3) of section 6 of the act referred to above.3a. according to the scheme as projected in paragraph 4, the amount of money for which the tax is payable shall be compounded for the first year and shall be at least 25% more in case of towns with population up 10 one lac and in other cinema houses where the population is higher it would be 15% more than the amount of tax admitted for assessed previous year as may be determined by the compounding authority. for the subsequent year or part thereof, the increase shall not be less than 10%. this is to be applied while keeping in view the licensed seating capacity. the admitted position is that the petitioner offered for composition of entertainments tax and the same was allowed vide office order dated 27-1-1988 for a period of one year with effect from 29-1-1988 to 28-1-1989 and this composition has been extended from year to year. this is further an admitted position that the petitioner is liable to pay entertainment tax to the tune of rs. 4,18, 173/- and additional entertainment to the tune of rs. 3177/-and advertisement tax to the tune of rs. 1038/-, totalling rs.4,32,388/- per annum. the petitioner has admittedly paid the tax in advance up to december, 1992.4. the additional district magistrate (city), jodhpur vide order dated 7-i2-i992 directed all the cinema owners not to exhibit the last show with effect from 7-12-1992 in exercise of the powers conferred upon him under section 144, cr. p. c. this order has been placed as annx. 3.5. this is also an admitted position that the above said order continued till 18-12-1992 and last show was again allowed on 19-12-1992.6. according to the petitioner he was precluded to exhibit the last show on account of the lawful orders of the competent authority and there could be thus no collection of entertainments tax for these shows for the period mentioned. the petitioner thus claims that he is not liable to pay the tax for the said period which according to him come to rs. 42,817/- and further relief is sought that the petitioner is not liable to pay additional tax for the said period which is claimed at rs.421/-.7. the petitioner claims that he was entitled to the deduction of this amount in january and, therefore, he did not deposit this amount while depositing the advance lax in the month of january, 1993 and he was fully justified in not depositing this amount since there was no collection of the tax for the said period. intimation to this effect was sent to the commercial taxes officer, c-circle, jodhpur, which is placed on record as annx. 5.8. the petitioner further states that it was only because of the lawful order having been passed by a competent authority that the shows were closed down and the benefit is claimed in that respect. there have been closer of the cinema hall on several occasions during the 'bunds but the petitioner never claimed any benefit because the calls for those 'bunds' were unlawful.9. it is said in the petition that the petitioner received a communication from the deputy commissioner (administration), jodhpur, wherein it was ordered that though the cinema hall remained closed for the last show for the given period but the petitioner was not entitled to claim any rebate in view of the order of the government dated 8-6-1988. it is provided therein that if cinema hall remained closed for more than 30 days, it was only in that situation that the rebate could be claimed in the amount of composition. the request was thus declined vide order dated 26-12-1992. this order was endorsed to the commercial taxes officers with a direction that if he amount has not been deposited the same may be recovered as arrears of land revenue. this order dated 5-1-1993 has been placed as annx. 3.10. in the reply filed on behalf of the respondents it is said that it was on the application of the petitioner that the matter was compounded and final amount of tax was fixed for the period of one year vide annexs. r/2 and r/3. the matter amounts to a contract between the parties and they are bound by the terms and conditions fixed in this respect. the respondents rely on the circular dated 8-6-1988 (annx. r/4), a notice of which has been taken in the earlier part of this order where reduction in composition amount could be allowed only if the cinema hall remained closed for a period of 30 days in a year. this is condition no. 5 in the compounding order dated 27-1-1992. the respondents thus state that under these circumstances the petitioner was not entitled to any rebate or reduction in the composition amount. material facts have not been disputed.11. the learned counsel appearing for the petitioner vehemently contends that the order for composition of tax has been issued while keeping in view total capacity of the hall and number of shows which are exhibited in the cinema hall and this amount was arrived at while taking into consideration the highest revenue of preceding three years and the same was further enhanced by 10%. in this manner if the petitioner had been permitted to exhibit four shows in the cinema hall it was only in that situation that the composition amount could be demanded from him. since the petitioner was restrained from exhibiting the last show he was entitled to claim exemption for the proportionable amount in the composition fee.12. the learned counsel further cortends that the petitioner did not close down the last show on any other account but this was so done in obedience to the orders passed by the additional district magistrate and the cinema hall thus remained closed for that show from 7-12-1992 to 18-12-1992. the petitioner cannot made liable to pay the entertainment tax for the said period.13. the learned counsel appearing from the side of the respondents has strongly relied upon the circular date 8-6-1988 (annx. r. 4) wherein the concession could be allowed if the cinema hall remained closed for a period not less than 30 days in the whole years. the lump sum amount is said to be fixed for the complete year and the petitioner was bound by the condition of the composition order under section 6(3) of the act and this could not be permitted to be challenged as the same is a condition of the contract and the petitioner is estopped from laying the challenge to any condition in respect of the composition order which he has volunteered himself, ft is next contended that the petitioner had voluntarily agreed not to be assessed and checked for each and every show or for each and every day for the composition period. the petitioner thus could not be given any benefit in view of condition no. 5 of the order annx. r/4.14. after hearing the learned counsel for the parties and after having gone through the record i am of the opinion that this writ petition deserves to be allowed.15. admittedly the petitioner was ordered to close down the cinema hall for the last show and admittedly the cinema hall was not run for the period for that show and as such no amount of entertainment tax was realized by the petitioner since no films were exhibited for these shows. there was no sale of tickets either. the impugned order dated 5-1-1993 (annx. 6) appears to be unjust and further appears to be based on the circular dated 8-6-1988. though a case of discrimination has been made out between one cinema hall which was closed down for the 30 days and rebate is allowed than the one which was closed for less than 30 days where rebate is to be disallowed. there appears to be no rationale or underlying idea or object which is sought to be achieved by mentioning 30 days or more. although the petitioner has prayed that the words 30 days or more may be directed to be deleted from the circular and the circular should be read so as to convey a meaning that the amount of composition is not payable for the period for which cinema hall remained closed. i am not prepared to accept this argument as in the given situation it may hold good.16. the petitioner in this particular case is faced with a peculiar situation. the last show had to be closed under the lawful orders of competent authority. the petitioner cannot be made to suffer on that account. when admittedly there has been no collection of the tax by the petitioner in sequence of the orders passed by the additional district magistrate, how can he be directed to pay the amount for the given period. in one of the cases, i.e., s.b. civil writ petitioner no. 1790/93 the cinema hall remained closed since the curfew was imposed by the administration. a citizen cannot be made to suffer on account of the compliance of the lawful orders. it would amount to realize an amount from the petitioner for the period for which the cinema hall remained closed for the last show. order dated 5-1-1993 annex. 6 is quashed.17. in view of what has been said above the writ petition succeeds and the petitioner is allowed the benefit in respect of the period in question.18. as a result all the writ petitions are consequently allowed in the same terms.19. no order as to costs.

Judgment:
ORDER

P.K. Palli, J.

1. These writ petitions raise common question of fact and law and thus are proposed to be disposed of by a common order. The facts are taken from S. B. Civil Writ Petition No. 297/1993.

2. The petitioner is running a Cinema in the City of Jodhpur known as Kohinoor Cinema. The State of Rajasthan enacted an Act known as Rajasthan Entertainments & Advertisements Tax Act, 1957 (for short 'the Act) and under Section 4 of the Act tax is leviable at the rate not exceeding 100% of the payment for purposes of admission which is popularly called as entertainment tax. This tax is leviable even on complimentary ticket which is issued by the Proprietor. Section 5 of the Act lays down the manner in which the payment of tax is to be made and is to be calculated depending upon the number of admission. Section 5B deals with the assessment. Section 5C deals with re-assessment and Section 6 of the Act deals with admission to entertainments and lays down that no person other than a person who has to perform some duty in connection with an entertainment imposed upon him by any law or otherwise shall be admitted for payment to an entertainments tax except with a ticket stamped with an impressed, embossed, engraved or adhesive stamp not used earlier issued by the State Government for the purpose of revenue. It is also laid down that the Proprietor shall not admit any person without payment for admission thereof except in accordance with the prescribed conditions.

3. Next comes Sub-section (3) of Section 6, which provides that the Government may on the application of the Proprietor allow such Proprietor on such condition as may be prescribed -- (a) to compound the tax payable in respect of such entertainment for a fixed sum, or (b) to pay the amount of the tax due -- (i) by a consolidated payment of such percentage of the gross sum received by the proprietor or on account of payments for admission to the entertainment and on account of the tax, as the State Government may fix, or (ii) in accordance with returns of the payments for admission to the entertainment and on account of the tax, or (iii) in accordance with the results recorded by any mechanical contrivance which automatically registers the number of persons admitted. The petitioner has placed on record Annx. 1, which is a scheme that has been introduced by the Government for composition of entertainments tax under Sub-section (3) of Section 6 of the Act referred to above.

3A. According to the scheme as projected in paragraph 4, the amount of money for which the tax is payable shall be compounded for the first year and shall be at least 25% more in case of towns with population up 10 one lac and in other Cinema Houses where the population is higher it would be 15% more than the amount of tax admitted for assessed previous year as may be determined by the Compounding authority. For the subsequent year or part thereof, the increase shall not be less than 10%. This is to be applied while keeping in view the licensed seating capacity. The admitted position is that the petitioner offered for composition of entertainments tax and the same was allowed vide office order dated 27-1-1988 for a period of one year with effect from 29-1-1988 to 28-1-1989 and this composition has been extended from year to year. This is further an admitted position that the petitioner is liable to pay entertainment tax to the tune of Rs. 4,18, 173/- and additional entertainment to the tune of Rs. 3177/-and advertisement tax to the tune of Rs. 1038/-, totalling Rs.4,32,388/- per annum. The petitioner has admittedly paid the tax in advance up to December, 1992.

4. The Additional District Magistrate (City), Jodhpur vide order dated 7-I2-I992 directed all the Cinema owners not to exhibit the last show with effect from 7-12-1992 in exercise of the powers conferred upon him under Section 144, Cr. P. C. This order has been placed as Annx. 3.

5. This is also an admitted position that the above said order continued till 18-12-1992 and last show was again allowed on 19-12-1992.

6. According to the petitioner he was precluded to exhibit the last show on account of the lawful orders of the competent authority and there could be thus no collection of entertainments tax for these shows for the period mentioned. The petitioner thus claims that he is not liable to pay the tax for the said period which according to him come to Rs. 42,817/- and further relief is sought that the petitioner is not liable to pay additional tax for the said period which is claimed at Rs.421/-.

7. The petitioner claims that he was entitled to the deduction of this amount in January and, therefore, he did not deposit this amount while depositing the advance lax in the month of January, 1993 and he was fully justified in not depositing this amount since there was no collection of the tax for the said period. Intimation to this effect was sent to the Commercial Taxes Officer, C-Circle, Jodhpur, which is placed on record as Annx. 5.

8. The petitioner further states that it was only because of the lawful order having been passed by a competent authority that the shows were closed down and the benefit is claimed in that respect. There have been closer of the Cinema Hall on several occasions during the 'bunds but the petitioner never claimed any benefit because the calls for those 'bunds' were unlawful.

9. It is said in the petition that the petitioner received a communication from the Deputy Commissioner (Administration), Jodhpur, wherein it was ordered that though the Cinema Hall remained closed for the last show for the given period but the petitioner was not entitled to claim any rebate in view of the order of the Government dated 8-6-1988. It is provided therein that if Cinema Hall remained closed for more than 30 days, it was only in that situation that the rebate could be claimed in the amount of composition. The request was thus declined vide order dated 26-12-1992. This order was endorsed to the Commercial Taxes Officers with a direction that if he amount has not been deposited the same may be recovered as arrears of land revenue. This order dated 5-1-1993 has been placed as Annx. 3.

10. In the reply filed on behalf of the respondents it is said that it was on the application of the petitioner that the matter was compounded and final amount of tax was fixed for the period of one year vide Annexs. R/2 and R/3. The matter amounts to a contract between the parties and they are bound by the terms and conditions fixed in this respect. The respondents rely on the circular dated 8-6-1988 (Annx. R/4), a notice of which has been taken in the earlier part of this order where reduction in composition amount could be allowed only if the Cinema Hall remained closed for a period of 30 days in a year. This is condition No. 5 in the compounding order dated 27-1-1992. The respondents thus state that under these circumstances the petitioner was not entitled to any rebate or reduction in the composition amount. Material facts have not been disputed.

11. The learned counsel appearing for the petitioner vehemently contends that the order for composition of tax has been issued while keeping in view total capacity of the Hall and number of shows which are exhibited in the Cinema Hall and this amount was arrived at while taking into consideration the highest revenue of preceding three years and the same was further enhanced by 10%. In this manner if the petitioner had been permitted to exhibit four shows in the Cinema Hall it was only in that situation that the composition amount could be demanded from him. Since the petitioner was restrained from exhibiting the last show he was entitled to claim exemption for the proportionable amount in the composition fee.

12. The learned counsel further cortends that the petitioner did not close down the last show on any other account but this was so done in obedience to the orders passed by the Additional District Magistrate and the Cinema Hall thus remained closed for that show from 7-12-1992 to 18-12-1992. The petitioner cannot made liable to pay the entertainment tax for the said period.

13. The learned counsel appearing from the side of the respondents has strongly relied upon the circular date 8-6-1988 (Annx. R. 4) wherein the concession could be allowed if the Cinema Hall remained closed for a period not less than 30 days in the whole years. The lump sum amount is said to be fixed for the complete year and the petitioner was bound by the condition of the composition order under Section 6(3) of the Act and this could not be permitted to be challenged as the same is a condition of the contract and the petitioner is estopped from laying the challenge to any condition in respect of the composition order which he has volunteered himself, ft is next contended that the petitioner had voluntarily agreed not to be assessed and checked for each and every show or for each and every day for the composition period. The petitioner thus could not be given any benefit in view of condition No. 5 of the order Annx. R/4.

14. After hearing the learned counsel for the parties and after having gone through the record I am of the opinion that this writ petition deserves to be allowed.

15. Admittedly the petitioner was ordered to close down the Cinema Hall for the last show and admittedly the Cinema Hall was not run for the period for that show and as such no amount of entertainment tax was realized by the petitioner since no films were exhibited for these shows. There was no sale of tickets either. The impugned order dated 5-1-1993 (Annx. 6) appears to be unjust and further appears to be based on the circular dated 8-6-1988. Though a case of discrimination has been made out between one Cinema Hall which was closed down for the 30 days and rebate is allowed than the one which was closed for less than 30 days where rebate is to be disallowed. There appears to be no rationale or underlying idea or object which is sought to be achieved by mentioning 30 days or more. Although the petitioner has prayed that the words 30 days or more may be directed to be deleted from the circular and the circular should be read so as to convey a meaning that the amount of composition is not payable for the period for which Cinema Hall remained closed. I am not prepared to accept this argument as in the given situation it may hold good.

16. The petitioner in this particular case is faced with a peculiar situation. The last show had to be closed under the lawful orders of competent authority. The petitioner cannot be made to suffer on that account. When admittedly there has been no collection of the tax by the petitioner in sequence of the orders passed by the Additional District Magistrate, how can he be directed to pay the amount for the given period. In one of the cases, i.e., S.B. Civil Writ Petitioner No. 1790/93 the Cinema Hall remained closed since the curfew was imposed by the Administration. A citizen cannot be made to suffer on account of the compliance of the lawful orders. It would amount to realize an amount from the petitioner for the period for which the Cinema Hall remained closed for the last show. Order Dated 5-1-1993 Annex. 6 is quashed.

17. In view of what has been said above the writ petition succeeds and the petitioner is allowed the benefit in respect of the period in question.

18. As a result all the writ petitions are consequently allowed in the same terms.

19. No order as to costs.