TMI Blog2012 (10) TMI 975X X X X Extracts X X X X X X X X Extracts X X X X ..... ined as "luxury provided in hospitals" for the purpose of the Act and in determining the gross charges, what is charged for food, medicine and professional services is excluded. By this process, the Legislature has kept out of the purview of the Act, hospitals which charge less than rupees one thousand per day. Such provisions of the Act, are within the legislative competence of the State and consequently, there is no basis for the contention that, the Act to the extent it covers hospitals, is ultra vires the Constitution. Therefore, the second contention raised by the petitioners is rejected. - W P. (C) Nos. 23312 of 2008 & W.P. (C) Nos. 1390 of 2009 - - - Dated:- 15-10-2012 - ANTONY DOMINIC, J. For the Appellant : V.V. Asokan, K.I. Mayankutty Mather, Smt. S. Amina, P.P. Ramachandran and E.M. Unnikrishnan (Manjeri) For the Respondents : Sojan James, Special Government Pleader and T.K. Shaij Raj, Government Pleader, ANTONY DOMINIC J.- The issues raised in these writ petitions being common, these cases were heard together and are disposed of by this common judgment, treating W.P. (C) No. 1390 of 2009 as the leading case. 2. The petitioner states that it is an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontention was that the establishment being a hospital, the Act became applicable only by virtue of Act 21 of 2008 and with effect from April 1, 2008, and therefore, the demand contained in exhibit P3 notice for the production of the documents from 2003 is illegal. The second point raised was that the Act, to the extent it covers hospitals, is beyond the powers conferred on the State Legislature under entry 62 of List II of the Seventh Schedule to the Constitution of India. 6. The respondents have filed a detailed counter-affidavit justifying the notice issued by them. In the affidavit, it is contended that having regard to the luxuries that are provided, the establishment in question is liable to be treated as a hotel and hence they were entitled to issue the notice calling for the production of documents from 2003. They also contended that under entry 62 of List II, the State Legislature was competent to pass the legislation in question. 7. I have considered the submissions made by both sides. 8. As far as the first question whether the petitioner's establishment is a hotel or not is concerned, if it is a hotel, since hotels were already covered by the Act, the respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents, betting and gambling but would only emphasise the attribute which is common to the group. If luxuries is understood as meaning something which is purely for enjoyment and beyond the necessities of life, there can be no doubt that entertainments, amusements, betting and gambling would come within such understanding. Additionally, entertainments, amusements, betting and gambling are all activities. 'Luxuries' is also capable of meaning an activity and has primarily and traditionally been defined as such. It is only derivatively and recently used to connote an article of luxury. One can assume that the coupling of these taxes under one entry was not fortuitous but because of these common characteristics. (vide paragraph 74). ... Hence on an application of general principles of interpretation, we would hold that the word 'luxuries' in entry 62 of List II means the activity of enjoyment of or indulgence in that which is costly or which is generally recognized as being beyond the necessary requirements of an average member of society and not articles of luxury. (vide paragraph 83). ... Given the language of entry 62 and the legislative history we hold th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall get itself registered with such authority and in such manner as may be prescribed, and the application for registration shall be accompanied by a registration fee of rupees one thousand. The registration shall be for a period of one year and shall be renewed annually. 15. The aforesaid being the relevant provisions of the Act, these can be summarized thus: (1) that levy of luxury tax is for accommodation for residence and use of the amenities and services provided in a hospital. (2) that the gross charges levied by the hospitals shall be rupees one thousand or more. (3) that in calculating the gross charges levied, the charges of food, medicine and professional services are excluded. (4) that the rate of luxury tax shall be ten per cent of the gross charges levied. 16. These provisions of the Act make it clear that luxury tax is not levied on hospitals as such, instead, the levy is for enjoying the accommodation for residence and the amenities and services for hospitably, such of those hospitals, which, exclusive of what it charges for food, medicine and professional services, charges rupees one thousand or more per day from the patients who enjoy the accomm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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