2011 (4) TMI 1232 - HC - Indian Laws

Order dated July 17 2000 passed by the first respondent viz. the State of Gujarat in exercise of powers under section 9(2) of the Gujarat Tax on Luxuries (Hotels and Lodging Houses) Act 1977 directing the petitioner to pay Rs. 36, 035 towards luxury tax Rs. 36, 035 towards fine and Rs. 4, 000 for compounding the offence totalling to Rs. 76, 070 as well as the order dated January 1 2000 passed by the second respondent that is the Deputy Commissioner (Tax on Luxuries) State of Gujarat Gandhinagar cahhalnged Held that - In the facts and circumstances of the case the first respondent took note of the fact that the hotel management was regularly maintaining form No. 3 and had also deposited the amount of tax. He therefore modified the order passed by the second respondent and assessed the tax for a period of five months instead of twelve months as computed by the second respondent and accordingly assessed the tax payable at Rs. 36, 035; reduced the penalty amount under section 7 of the Act to Rs. 36, 035; and compounding charges to Rs. 4, 000. Accordingly the amount payable by the petitioner under the order passed by the second respondent was reduced from Rs. 2, 26, 210 to Rs. 76, 070. approach and has reduced the assessed amount as well as amount of penalty and compounding charges. In the circumstances the conclusion arrived at by the first respondent being based on concurrent findings of fact recorded by both the authorities below after appreciation of the evidence on record does not warrant any interference by this court in exercise of powers under article 226 of the Constitution of India. Appeal dismissed.

Summary

Issues: Challenge to luxury tax order under Gujarat Tax on Luxuries Act, 1977.

Analysis:
The petitioner, a private limited company operating a hotel, challenged an order directing payment of luxury tax, fine, and compounding charges under the Gujarat Tax on Luxuries Act, 1977. The petitioner responded to a show-cause notice explaining discrepancies in tariff rates for certain rooms. The second respondent accepted explanations for some grounds but not for others. For instance, discrepancies in tariff rates for specific rooms were found, with the second respondent concluding that the petitioner attempted to evade tax payment. The second respondent assessed the tax, penalty, and compounding charges, which the petitioner appealed. The first respondent upheld the findings but reduced the assessed amount, penalty, and compounding charges based on the hotel's compliance history and maintained records. The court found no reason to interfere with the concurrent findings of fact by both authorities, dismissing the petition and discharging the rule with no costs.