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2017 (12) TMI 1238 - HC - VAT and Sales TaxVires of the second explanation to Section 2(m) of the Delhi Entertainment and Betting Tax Act - The GNCT of Delhi amended Section 2 (m) of the Entertainment Tax Act by adding two explanations and took the position that these provisions were clarificatory; the amendments were inserted on 1 October 2012 but brought into force with effect from 01 April 1998. These amendments are the subject matter of challenge in the present writ proceedings - FDCI challenges the impugned amendment to the Explanation on the ground that the power of a state is to impose taxes under Entry 62 of list II on “luxuries including entertainment” and consequently the impugned explanation is ultra vires the Constitution and is beyond the scope of Entertainment Tax Act - petitioners argue that entertainment is an activity by which one person provides entertainment to another; organizers such as the petitioner, through sponsorship funding organize or create events. Whether an event is an entertainment or not would depend on the facts and as such entertainment could not be defined in a straitjacket formula. Whether as a fashion development and promotion society, which conducts fashion shows provides entertainment by hosting such shows? - Whether payment for admission includes sponsorship? - the events are non-ticketed events where entry is by special invite of the organizers Dissent Decision - Both the Judges delivers different judgments. In one view, no entertainment tax can be collected and allowed the writ petitions. Another view is that entertainment tax can was rightly demanded and dismissed the appeal of the writ petitions.
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