TMI Blog2017 (4) TMI 627X X X X Extracts X X X X X X X X Extracts X X X X ..... they are performed for any educational, medical, charitable, philanthropic or such other purposes or irrespective of fact whether they are performed for commercial purpose or not and / or there is a commercial element on such activities / entertainment, they shall be exempted from payment of entertainment tax cannot be accepted. As in the present case it is an admitted position that the live musical concerts organized by the petitioner on 24.12.2016 was admittedly not for any educational, medical, charitable, philanthropic or such other purposes. It is an admitted position that same is having commercial element and even they charge also very high entry fee ranging from ₹ 500/above and may be upto to ₹ 5000/per entry. Under the circumstances it cannot be said that the action of the respondent can be said to be in any way illegal and / or contrary to the legislative intent of Section 3A and Schedule III of the Entertainment Tax Act. - Special Civil Application No. 2444 of 2017 - - - Dated:- 30-3-2017 - M.R. SHAH AND B. N. KARIA, JJ. MR. MIHIR THAKORE, SR. ADVOCATE WITH VIRAL K SHAH, ADVOCATE FOR THE PETITIONER MR. KAMAL TRIVEDI ADVOCATE GENRAL WITH MS. SA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is vehemently submitted by Shri Mihir Thakore, learned counsel for the petitioner that as per Section 3A of the Act, which has been amended subsequently, notwithstanding anything contained in Section 3, there shall not be levied and paid tax to the State Government on any payment for admission to entertainments specified in the Schedule III. It is submitted that Section 3 is charging Section which provides that there shall be levied and paid to the State Government and on every payment for admission to an entertainment a tax. It is submitted that however as per Section 3A, notwithstanding anything contained in Section 3, there shall not be levied and paid the tax to the State Government on any payment for admission to entertainments specified in the Schedule III. It is submitted that as per Schedule III which has been inserted by Gujarat Act 8 of 1998, all kinds of musical programmes including musical nights and opera would fall under Schedule III and therefore, all kinds of musical programmes including musical nights and opera shall be exempted from payment of entertainment tax in view of specific provision contained in Section 3 A of the Act. It is vehemently submitted by Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edi, learned Advocate General for the State. An affidavit in reply is filed on behalf of State Authority opposing the present petition. 5.1. Shri Trivedi, learned Advocate General has opposed the present petition by submitting that against the impugned order/ communication a statutory alternative efficacious remedy is available with the petitioner. It is submitted that even the petitioner was called upon to submit details at least by three communications, however the petitioner failed to submit any detail and therefore, the authority was required to get the details from the internet website book my show and thereafter appropriate authority has passed the impugned order on 27.01.2017. It is submitted that against the impugned order dated 27.01.2017, further appeal is provided under Section 12 of the Act and therefore, the petitioner may be relegated to avail said statutory efficacious and adequate remedy. 5.2. It is vehemently submitted by Shri Kamal Trivedi, learned Advocate General that impugned action of the respondent State to levy the entertainment tax on such events like the event organized by the petitioner is absolutely in consonance with the provisions of the Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that with above object, contained in Budget Speech delivered by the Hon ble Finance Minister made while introducing Section 3(A) and Schedule III of the Act, thereafter the State Legislature amended the Act by inserting new Section 3A in the Act. It is submitted that even the statement of objects and reasons of aforesaid Amended Act, 1998 states that this Bill seeks to insert new section 3A in the Gujarat Entertainment Tax Act, 1977 with a view to give effect to the proposal contained in the Budget Speech of the Finance Minister in the Assembly on the 30th June, 1998. It is submitted that therefore, the purpose and object of Section 3A is required to be considered along with Budget Speech of the Finance Minister in the assessmbly on 30.06.1998, while considering the object and purpose of insertion of Section 3A of the Act, 1977. It is submitted that therefore, the budget speech of the Hon ble Finance Minister in the Assembly in juxtaposition with the provisions of statement of Objects Reasons, provisions of section 3A and ScheduleIII, leads to only one conclusion that the exemption has been granted from payment of Entertainment Tax to the programmes and activities which are in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... izers were required to take permission for exemption and therefore, it was thought it fit to exempt such activities from payment of entertainment tax and for which it was proposed to have a separate provision / Section. It is submitted that therefore, Section 3A of the Act has direct nexus and connection with the exemption provision i.e. Section 29 of the Act. It is submitted that therefore, another object and purpose of the Act was to avoid making such application for exemption every time. It is submitted that therefore, Section 3A and Schedule III are to be read along with exemption provision contained in Section 29 of the Act. It is submitted that as such intention of the legislature was never to give exemption from payment of entertainment tax on all activities mentioned in Schedule III irrespective of fact where there is element of commercial nature and / or profit making or not. 5.6. Shri Trivedi, learned Advocate General has heavily relied upon the following decisions of the Hon'ble Supreme Court in support of his submission that while interpreting Section 3A and purpose of Section 3A, the Budget Speech delivered by the Hon'ble Finance Minister on the floor house, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to insert Section 3A of the Act. 9.0. While considering the question posed in the present petition, the budget speech of the Hon'ble Finance Minister while proposing to insert Section 3A and the statement of objects and reasons of the Amendment Act, 1998, by which, Section 3A was inserted are required to be referred to so as to appreciate the object and purpose and the legislative intent of insertion of Section 3 A of the Act, which reads as under: The State Government is committed to encourage acting, cultural activities, sports activities. For organizing such activities, the organizers have to take permission for exemption. I am making a statement that such activities will be exempted from payment of Entertainment Tax, i.e. music, dance, drama, cultural programmes, circus, magic shows, puppet shows and Mushaira. Similarly, all sports activities will be exempted from payment of Entertainment Tax. A detailed list containing such activities and programmes will be in the form of Schedule in the Act pertaining to Entertainment Tax. 9.1. The statement of Objects Reasons of the aforesaid Amendment Act of 1998 is reproduced hereunder for ready reference. This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by notification in the Official Gazette, exempt either wholly or partly, any entertainment or class of entertainments from payment of tax. [x x x] subject to such conditions as may be specified therein- (a) where such entertainment is provided for any educational, medical, charitable, philanthropic or such other purpose; or (b) where the State Government considers it necessary so to do in the public interest. (2) Every notification issued under sub-Section( 1) shall be laid for not less than thirty days before the State Legislature as soon as possible after it is issued and shall be subject to rescission by the State Legislature or to such modification as the State Legislature may make during the session in which it is so laid or the session immediately following. (3) Any rescission or modification so made by the State Legislature shall be published in the Official Gazette and shall thereupon take effect. 9.3. Thus from the aforesaid, it can be seen that prior to insertion of Section 3A, as per Section 29 of the Act any entertainment or class of entertainment provided for educational, medical, charitable, philanthropic or such other purpose, were eligib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng such activity is to maintain and promote non commercial activities being conducted for educational, medical, charitable, philanthropic or cultural purpose in contradistinction with a commercial or profitmaking venture like the one involved in the present case. As observed herein above, prior to Amendment Act, 1998 i.e. insertion of Section 3A any entertainment or class of entertainment provided for any educational, medical, charitable, philanthropic or such other purpose were exempted either wholly or partly from payment of tax. Therefore, the exemption provided under Section 3A when read together with Budge Speech delivered by the Hon'ble Finance Minister made in the Assembly on 30.06.1998 read with statement of objects and purpose of Amendment Act, 1998, the intention seems to be to grant exemption any entertainment or class of entertainment where such entertainment is provided for any educational, medical, charitable, philanthropic or such other purpose and such exemption does not seem to be meant for the activities / entertainment having a commercial element. To find out real intent / legislative intent of a party statute, as observed by the Hon'ble Supreme Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be remedied by the enactment of Sub-Section (2) and why the enactment of Sub-Section (2) was found necessary. It is apparent from the speech of the Finance Minister that Sub-Section( 2) was enacted for the purpose of reaching those cases where there was understatement of consideration in respect of the transfer or to put it differently, the actual consideration received for the transfer was 'considerably more' than that declared or shown by the assessee, but which were not covered by Sub-Section (1) because the transferee was not directly or indirectly connected with the assessee. The object and purpose of Sub-Section (2), as explicated from the speech of the Finance Minister, was not to strike at honest and bonafide transactions where the consideration for the transfer was correctly disclosed by the assessee but to bring within the net of taxation those transactions where the consideration in respect of the transfer was shown at a lesser figure than that actually received by the assessee, so that they do not escape the charge of tax on capital gains by understatement of the consideration. This was real object and purpose of the enactment of Sub-Section (2) and the interpr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tled to exemption from payment of entertainment tax like musical concert performed in the present case which has commercial element and the sole purpose is for profit making and all those activities mentioned in Schedule III shall be entitled to exemption from entertainment tax if there is an element of educational, medical, charitable, philanthropic or such other purposes and element is non commercial and non profit making. Therefore, the submission on behalf of the petitioner that for all the activities / entertainment mentioned in Schedule III irrespective of whether they are performed for any educational, medical, charitable, philanthropic or such other purposes or irrespective of fact whether they are performed for commercial purpose or not and / or there is a commercial element on such activities / entertainment, they shall be exempted from payment of entertainment tax cannot be accepted. In view of the above discussion, whether in the present case the respondent authorities are justified in calling upon the petitioner to pay entertainment tax on the programmes / live musical concert organized by them or not, it is an admitted position that the live musical concerts organi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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