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2018 (10) TMI 452 - HC - VAT and Sales TaxLevy of Luxury Tax - renting of rooms in a hotel - levy under sub-section (2A) of Section 4 - petitioner would contend that the Division Bench has wrongly arrived at the conclusion that a club could be charged with luxury tax on the renting of rooms it does at its premises. Held that:- We have to first look at the decision of this Court in Trivandrum Club [2013 (1) TMI 606 - KERALA HIGH COURT]. Therein the Division Bench had specifically noticed the contention raised by the appellant that unless accommodation is provided in the building as part of business against collection of rent, the building cannot be called hotel. The Division Bench found that the definition of hotel under the Act has a wider meaning, especially noticing the Explanation covering even guest houses run by the Government or a Company or a Corporation. What is sought to be taxed is not the renting of rooms for accommodation alone, but also the renting of auditorium, kalyanamandapam or hall and the amenities and services provided therein excepting service of food and beverages. Section 4 understands this distinction and levies and collects tax on the luxury provided in a hotel, house boat, hall, auditorium or kalyanamandapam. Consciously, aware of 'luxury' including renting of rooms as also use of auditoriums and kalyanamandapams and the other amenities and services provided, the inclusive levy is on the renting of hall, auditorium or kalyanamandapam attached to hotels and clubs and renting of rooms attached to a hall, auditorium or kalyanamandapam. The mere inclusion of club in the charging section and its exclusion from the definition of hotel or of luxury cannot at all be found to be significant insofar as the claim of the assessee to exempt them from such levy. Levy under sub-section (2A) of Section 4 - Held that:- The levy under sub-sections (1) and (2A) of Section 4 are quite distinct and different and can both be traced to Entry 62 of List II of Schedule VII of the Constitution of India - The luxury is specifically defined under sub-Section (f) and so is the charge created by Section 4(1). The incidence of tax is the enjoyment of such luxury, by the renting of rooms or halls, etc. The person on whom the levy is imposed is that person who enjoys the luxury the liability to collect being on the hotel, hall, kalyanamandapam or auditorium. The rate is also crystal clear from Section 4(2) and measure is the charge at which such renting of rooms or use of such premises is made and the charge for the other amenities and services provided in the specified premises. As far as Section 2A is concerned, the levy is conceded to by the petitioner. Appeal dismissed.
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