RAJA RAJAN THEATRE Vs. STATE

JUDGEMENT

(1.) This is a petition for the issue of a writ of certiorarified mandamus, to call for the records in G.O.P. No.762 dt. 15-7-83, on the file of 3rd respondent made pursuant to G.O.Ms. No.651 R.D. and L.A. dt. 9-5-83, on the file of the 1st respondent and quash the same in so far as the petitioner is concerned and direct the respondents to collect tax only under S.5-A/ 5-B of Tamil Nadu Entertainment Tax Act 1939.

(2.) It is relevant to note that Raja Rajan Theatre, the petitioner herein, is a permanent theatre within Thanjavur Municipal limit from 21-2-1983. The petitioner opted to pay tax under S.5(B) of the Tamil Nadu Entertainments Tax Act, 1939 with effect from 21-2-1983 when Thanjavur Municipality was a Selection Grade Municipality. The tax payable was 31% of the gross collection capacity for a show multiplied by 23. By G.O.(P) No.762, Commercial Taxes and Religious Endowments, dt. 25-7-1983, the State Government issued a Notification under S.16-A of the Tamil Nadu Entertainments Tax Act 1939, omitting Thanjavur from the Selection Grade Municipalities in Schedule I Part A of the Tamil Nadu Entertainments Tax Act, 1939. The result was, the petitioner became ineligible to pay compounded rate of tax under S.5-B. Therefore, the 2nd respondent issued notice to the theatre in his ROC. 6801 / 83.B5 dt. 26-7-1983, demanding payment of tax under Ss.4, 4-A, 4-B and 4-C as well as under the Tamil Nadu Local Authorities Finance Act; 1961 with effect from 18-7-1983. Aggrieved by the notice of the 2nd respondent, the petitioner has preferred this writ petition.

(3.) It is also relevant to note that the Tamil Nadu District Municipalities Act, 1920 gives ample powers to the State Government to exclude any area from Selection Grade Municipality by means of Notification. The Tamil Nadu Entertainments Tax Act, 1939 gives the option under S.5-B to pay the tax for such of those theatres as are in the area as mentioned in the Table under S.5-B. If once such an area ceases to find place in the Table by reason of its being excluded from Selection Grade on the strength of a notification issued under the Tamil Nadu District Municipalities Act, 1920 automatically that area as and from the date of such exclusion ceases to enjoy the benefits of S.5-B.