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2016 (9) TMI 310 - HC - Indian LawsDemand of entertainment tax from the exhibitors - assessment to tax under the Assam Act - Held that:- The tax recovered by the exhibitors, as admitted by the 2nd group of litigants, in our view is not collected illegally and therefore we declare that they have no obligation under Section 172 of the Contract Act, to refund any entertainment tax for the exempted period. As earlier noted the charge and levy of tax was never exempted and therefore the cine-goers were not provided any relief under the exemption notification. On the other hand, the exhibitor was freed of their obligation from the liability to the entertainment tax, through the notification issued under Section 8(2) of the Assam Act. Therefore we have no hesitation to hold that incentive was intended for the investors on cineplexes and consequently for the relevant period, the exhibitors can’t be forced to discharge their obligation under Section 3(6) of the Assam Act. Since in the present case, entertainment tax has been levied only on the ground that in spite of the exemption having been granted by the notification dated 29.03.2008, petitioners allegedly collected entertainment tax, the impugned orders of assessment are declared to be illegal, without jurisdiction and therefore the same are set aside and quashed. Following the above discussion and our conclusion in favour of the exhibitors on all the issues as delineated above, we declare that the demand of entertainment tax from the exhibitors for the period specified in the notification dated 29.3.2008 (Annexure-I) is illegal and therefore the assessment to tax under the Assam Act for the petitioners are quashed. The cases are allowed with this declaration.
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