RITURAJ TALKIES Vs. MAMLATDAR CUM PRESCRIBED OFFICER

JUDGEMENT

(1.) In this petition under Article 226 of the Constitution, the petitioner running a Cinema in Dhangadhra Town of Surendrangar District has challenged the order dated 2-12-1995 (Annexure F) passed by the Commissioner of Entertainment Tax, Gujarat State confirming the order dated 6-5-1995 (Annexure D) passed by the Collector, Surendranagar under the Gujarat Entertainment Tax Act, 1977 and also consequential demand notices at Annexure H & I requiring the petitioner to pay Rs.2,89,856.00.

(2.) The petitioner was running a cinema at Dhrangadra. The petitioner had exercised the option for payment of consolidated entertainment tax under sec. 6 of the Act vide application dated 30-12-1993. That application was granted by the Designated Officer by order dated 5-1-1994 (Annexure B) on the basis that the houseful capacity was 712 seats in one show. Subsequently, by order dated 4-5-1994 (Annexure C) the Designated Officer determined the lumpsum entertainment tax at Rs. 9082.00 on the basis that the petitioner had reduced the houseful capacity of the Cinema Hall to 510 seats in one show w.e.f. 17.3.1994. It appears from the said order dated 4-5-1994 (Annexure C) that in case of consolidated entertainment tax, the amount of weekly tax was determined at the rate of 35% of the gross receipts for one houseful show multiplied by 24 shows irrespective of the number of shows held in a week as against computation of tax under sec. 3 (1) at the rate of 50% of the ticket proceeds for 28 shows in a week if the cinema owner did not opt for the consolidated tax option. Thereafter, the petitioner submitted an application dated 2-9-1994 (Annexure A) informing the Designated Authority that the petitioner was going to close the cinema from 2-9-1994 for an indefinite period and, therefore, the petitioner was not liable to pay any tax from 2-9-1994 onwards. On 10-4-1995, the petitioner submitted an application to the Collector of Entertainment Tax stating that the petitioner may be permitted to restart the cinema from 14-4-1995. That application came to be granted subject to the condition that the petitioner was to pay the tax liability for the period from 2-9-1994 to 13-4-1995 at Rs. 2,89,856.00. The Collector noted in the said order dated 6-5-1995 (Annexure D) that under the Government circular dated 21-4-1993 exemption could not be granted to a cinema owner from payment of lumpsum tax for the period during which the cinema remained closed for any reason whatsoever. Aggrieved by the said order, the petitioner went in revision before the Commissioner of Entertainment Tax. The Commissioner rejected the same by his impugned order dated 2-12-1995 (Annexure F) on the ground that under the circular dated 21-4-1993 exemption could be granted from payment of consolidated entertainment tax only if the cinema owner had to keep the cinema closed for more than a week on account of circumstances beyond his control such as natural calamities, riots etc.. The Commissioner noted that if the cinema was required to be closed down for economic reasons, such a closure was not covered by the circular dated 21-4-1993 for the purpose of granting the benefit of exemption from the payment of entertainment tax.

(3.) When this petition came up for admission hearing on 9-1-1996, this Court passed the following order: