BHARAT PALACE Vs. STATE OF U.P. ANOTHERS

JUDGEMENT

(1.) THE contention of the learned counsel for the petitioner is that the proviso to sub -section (1) Section 3 of U.P. Entertainments and Betting Tax Act, 1979 is not part of the charging provision which is Section 3(1) of the said Act. It is urged that the proviso is intended to lay down only one of the modes of payment of tax, learned counsel further contended the admission to any entertainment is the taxable event and unless the licensee admits anyone to entertainment he will not be liable to tax simply because he has opted under the proviso to pay the tax on a compounded basis. We are unable to agree. Section 3(1) has to be read alongwith the proviso and not divorced from it. The provision embodies an integrated scheme. Under the main part, the tax is payable on the basis of the payment received for admission to any entertainment whereas if a person exercises option under the proviso to Section 3(1) to make compounded payment to the State Government in lieu of the payment of tax under sub -section (1) of Section 3, the tax is chargeable in a lump sum or compounded basis with reference to gross collection capacity. The liability under the proviso is not dependent on whether the shows were actually held and whether the viewers were admitted to entertainment. That is the only distinction between the main part of sub -section (1) of Section 3 and the proviso thereto. That the amount of tax under the proviso is not dependent upon the actual admission to entertainment finds further support from Form S prescribed by the State Government under Rule 24 -A of the U.P. Entertainments and Betting Tax Rules, 1981. Clause (3) of this format lays down that no rebate shall be permitted for any show not held. It is thus apparent that under the scheme of the enactment no rebate is contemplated even if shows are not actually held, in a case covered by the proviso to Section 3(1) i.e. where the licensee exercises his option to pay the tax in a lump sum.

(2.) WE , therefore, find no merit in the petitioner's contention that he was not liable to pay the amount for the period for which the cinema was closed. The petition is accordingly dismissed. A copy of this order may be given to the learned counsel for the petitioner by tomorrow on payment of the requisite charges.