GALAXY THEATRE Vs. STATE

JUDGEMENT

(1.) In these petitions the petitioners have challenged the validity of Ss. 4 and 4A of the Karnataka Entertainment Tax Act, 1958 ('the Act' for short) as unconstitutional. The main attack is founded on Articles 14 and 304(b) of the Constitution.

(2.) All the petitioners are owners of cinema theatres located at various towns and cities in the State of Karnataka.

(3.) Following contentions were urged by the learned counsel for the petitioners : I(a) Section 4 of the Act is violative of Article 14 of the Constitution, since unequals are treated as equals, inasmuch as the Section does not classify the exhibitors with reference to the area, wherein the theatre is located, its population, size and nature of the theatre etc. All kinds of exhibitors, irrespective of their capacity to earn or capacity to entertain, are treated alike. (b) The Table in Section 4 provides for different rates on shows depending upon the highest rate of admission fee in a theatre. Since all theatres, wherein Rs. 2.50 ps. and above per seat are treated alike, almost all theatres in the State are practically treated alike. (c) Smaller the theatre, the impact of the levy will be greater, as compared to a bigger theatre. II(a) Section 4A provides for levy of tax on composition basis and the payment of tax therein is on the basis of 'gross collection capacity', concept of which is unrelated to the realities and is oppressive. (b) Section 4A results in levy of tax on income or capacity and the impost ceases to be a tax on entertainment. III Concessions granted to regional films under Sections 4 and 4A are violative of Article 14 of the Constitution. IV Proviso to Section 4A discriminates between same kinds of regional films by applying different rates dependent upon their production being in Karnataka or outside Karnataka State. V The levy under Sections 4 and 4A are restrictions on freedom of trade and the Act having not received the assent of the President, offends Art. 304(b) of the Constitution. VI The special features of mini-theatre as in W. P. 6081/ 1988, having a small capacity of 300 seals only in Belgaum city has been ignored by the impugned provisions and thus Article 14 is contravened. The last contention, actually is an illustrative case involving earlier contentions, and therefore, need not be considered independently.