TMI Blog2018 (10) TMI 452X X X X Extracts X X X X X X X X Extracts X X X X ..... vies 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Pradesh]; (1961) 12 STC 122 [State of Bombay v. Automobile Agricultural Industries Corporation, Bombay]; (2017) SCC Online SC 1562 [Assistant Commissioner, Commercial Taxes Ors. v. LIS (Registered)]; 2001 (247) ITR 821 [Vikrant Tyres Ltd. v. First Income-Tax Officer]; and (2015) 1 SCC 1 [Commissioner of Income Tax (Central)- I, New Delhi v. Vatika Township Private Limited]. 4. Govind Saran Ganga Saran (supra) was a case in which the issue agitated was the levy of State tax on cotton yarn, which was notified as a declared goods. The Central Sales Tax Act provided two conditions insofar as declared goods; the maximum levy being restricted at 3% and it being confined to one single point. The State sought to tax the intrastate sale of cotton yarn for which there was no specific charge created in the State sales tax enactment. The Honourable Supreme Court dilated upon the concept of taxation and found it to have four components being (1) the character of the imposition, (2) the person on whom the levy is imposed, (3) the rate at which the tax is imposed and (4) the measure or value to which the rate is applied. Therein finding no specific levy for the intrastate sales, the Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods and was also liable to collect and pay to the State, special tax as also general tax. The dealer collected the same from its customers and on a return being filed separately for the two taxes, the Assessing Officer forfeited the amounts collected for the reason of the dealer not being registered under the Act. The Honourable Supreme Court looked at the provision which enabled collection of tax from the purchasers and found it to be applicable to registered dealers or a licensed dealer. Though the failure to register would attract the consequences as per the Act, being licensed the dealer was entitled to collect tax which could not have been forfeited, was the finding. 8. LIS (Registered) (supra) was a case in which the State sought to tax the respondent therein under the Kerala Tax on Paper Lotteries Act, 2005 bringing the respondent under the definition of a promoter under the Act. The respondent had been merely purchasing lotteries for its constituents, the prize money in which was distributed among the members. There was no reason for bringing the party within the definition of a promoter was the specific finding of the Honourable Supreme Court. 9. Vikrant Tyres L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... poration; wherein normally the accommodation would be provided only to its own employees, however at a reduced rent. 12. We have also to notice the definition of luxury provided in a hotel, house-boat, hall, auditorium or kalyanamandapam or place of like nature, which is accommodation for residence or use and other amenities provided therein the rate of charges of which exceeds a certain amount. The levy is also on the rate of charges of accommodation for residence and other amenities and services provided, excluding charges of food and liquor. The further contention raised by the petitioner is based on the specific reference to Clubs in Section 4, but its absence in sub-Sections (e) and (f) of Section 2. Section 4 being the charging section provides for a levy on the luxury provided in a hotel, house-boat, hall, auditorium or kalyanamandapam or place of like nature which is sufficient to levy tax on the clubs who rent out rooms for accommodation or lets its premises out and provides services and amenities therein. On an abundant caution the legislature included those attached to such places only to have more clarity regarding the renting out of auditoriums, halls and kalyanaman ..... X X X X Extracts X X X X X X X X Extracts X X X X
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