9911796707
TMI Blog2014 (7) TMI 741X X X X Extracts X X X X X X X X Extracts X X X X ..... ut authority of law; to quash annexure D dated February 15, 2010 passed by the second respon dent authority; to declare that amendment of section 4D carried out by Karnataka Act No. 5 of 2005 denying, inter alia, the MSOs the right to seek compounding of tax under section 4D as arbitrary, unreasonable and violative of articles 14, 19(1) (g) and article 300A of the Constitution and also to declare rule 41G as unconstitutional, illegal, without authority of law and having no rationale or nexus to the Scheme and scope of sections 4D and 4E of the Karnataka Entertainments Tax Act, by virtue of amend ment by Karnataka Act No. 5 of 2006. The petitioners are multi-system operators (for short, "MSOs") regis tered under the provisions of section 4D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd those operators who have less than 500 connections are assessed under section 4D, which according to them is discriminatory and that the aforesaid amendment has been introduced only to harass the peti tioners and to extract more tax from the petitioners. It is also contended that as per the mandate, the respondent-authority has not placed the amendment to rule 41G before the Legislature, thereby there is violation of section 18(3)(a) of the KET Act and when a statute requires certain thing to be done in a certain manner, it shall be deemed to have been prohibited the doing of that thing in any other way. Further, it is submitted that earlier for the purpose of composition at least 500 connections were required which has been undone by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ptember 2006 and this was with reference to section 4C of the KET Act. The petitioners have paid the taxes without any default and delay under section 4C of the KET Act at the rate of Rs. 6,500 per month. The learned senior counsel further submits that the petitioners were served with a preliminary endorsement purport ing to be the final endorsement dated February 15, 2010 by the second res pondent seeking for certain information of petitioners' business as a local cable TV operator and thereby directing the petitioners to pay tax under section 4C rather than section 4D by invoking rule 41G of the KET Rules and also one more final endorsement was served on the petitioners on March 8, 2010, which was received by the petitioners on March ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e small operators who have less than 500 connections and therefore, this exemption cannot be held to be either discriminatory or arbitrary and it is done only to protect the interest of small operators. Further, the learned Additional Government Advocate submits that Rules framed under the Act have also been placed before both the Houses and in this connection, reli ance is placed on the letter dated February 28, 2013 of the Under Secretary to Government of Karnataka, Legislature, to contend that the matter was placed before both the Houses of Legislature and there was due delibe ration and on that basis, Rules were upheld by accepting the amendment brought to the KET Act and Rules and as such, there is compliance of section 18(3A). Therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cable television directly to subscribers apart from providing satellite television signals to another proprietor, shall be liable to pay tax under this section in addition to his liability to pay tax under section 4G. Explanation.-(2) A proprietor being a direct-to-home service provider providing entertainment through antennae or cable televi sion directly to subscribers apart from providing satellite television signals under the direct-to-home scheme, shall be liable to pay tax under this section in addition to payment of any tax liability under section 4G. 4D. Composition of tax payable under section 4C.-In lieu of the tax payable under section 4C (any proprietor other than a multi system operator or a direct-to-home service provider, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to encourage the trade/profession among the small cable operators. So far as multi-system operators are concerned, as their area of operation is big and they earn more income, it has decided to impose tax based on the number of connections at the rate of Rs. 15 or Rs. 20 per connection if the number of connections is more than 500 depending upon the area, which cannot be said to be arbitrary or illegal or in violation of article 14 of the Constitution. In that view of the matter, the challenge made to the amendment brought into the Act and Rules are not maintainable. However, it is for the petitioners to approach the respon dents-authorities, if need be, seeking for extension of benefit of section 4D or to fix the upper-limit. With the abo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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