FILM EXHIBITORS GUILD Vs. STATE

JUDGEMENT

(1.) The point raised before the Full Bench is, whether, the proprietor of a Cinema Theater, on agreeing to pay entertainment tax under S.5, Andhra Pradesh Entertainment Tax Act (10 of 1939), for short, "the Act", is also liable to pay 'show-tax" under S.4-A of the Act, as mended in Act 24 of 1984, for short, "the Amendment Act". (It replaced the Andhra Pradesh Ordinance No. 9 of 1984 which came into force with effect from 1-1-1984).

(2.) To bring home the point in issue, the material facts in W.P. No. 14852/86 that lie in a short compass are stated thus : The first petitioner is a film exhibitors' guild, a registered society, the second petitioner is the proprietor of Viswanadha Picture Palace, Chilakaluripet. The members of the Ist petitioner's society are having Cinema Theaters in local areas of second grade municipalities and they applied for permission to pay tax under S.5 in lieu of the tax payable under S.4 in Form III and as per R. 27. They are governed by item (e) of Column 1 of the table appended to S.4. They were permitted to pay tax under S.5 in Form IV. Yet they are called upon to pay show-tax, though they are not liable as they have opted to pay tax under S.5. Despite their objection, when insisted upon, without prejudice to their right to recover or seek adjustment in the future entertainment tax payable, they have been making payments thereof. Their application on August 8, 1986, followed by a reminder informing the IInd respondent that they are not governed by S.4-A resulted in the impugned endorsement dt. Nov., 6, 1986, rejecting their stand and they are called upon to pay show-tax under S.4-A in addition to the tax under S.5. These facts are not in dispute. They are seeking mandamus directing the respondents to refrain from collecting "show-tax" under S.4-A; consequential direction to refund or adjust the excess tax payments so far made and also to quash the impugned Memo. No. 298/86 C dt. Sept., 6, 1986. One of the points raised in W.P. No. 10703/85 at the instance of the petitioner-proprietor is the same, though the facts are slightly different. Hence it is unnecessary to dilate those facts since the point involved is the same.

(3.) Sri Venktata Sastry, learned counsel for the petitioners, contends that S.4 enjoins payment of entertainment-tax on gross collection capacity on every show in the manner prescribed therein. S.5 affords an option to the proprietor of a theater specified on Column 2 of the table appended to Sub-S(1) of S.5, situated in the local areas in the corresponding Col. (1) for permission to pay the amount of tax every week as specified in corresponding Entry No. 3 thereof. The members of the lst petitioner society and the IInd petitioner have opted for the same; they were accorded permission by the IInd respondent and the permission shall continue till the end of the relevant financial year though subject to variability depending upon the exigencies enumerated in S.5. S.4-A enjoins the proprietor of the theater to pay show-tax in addition to the tax under S.4. Once the option exercised by the proprietor is accepted and given permission to pay the consolidated entertainment tax, for short 'composition tax', irrespective of the number of shows exhibited and paid as per Sub-S(4) of S.5, the liability engrafted under Sub-S(4) is absolved. S.5 does not postulate of payment of show-tax in addition to the tax under S.5 but in lieu of tax under S.4. Suitable phraseology like the one in S.4-A was not incorporated in S.5. Therefore, the legislature intended that those who opted to pay composition tax under S.5 are relieved of their liability to pay show-tax under S.4-A. The power to levy and collect the show-tax is without authority of law and jurisdiction. The learned Government Pleader, on the other hand, contends that the show-tax is in addition to the entertainment tax under S.4. Once the liability is fixed under S.4 and S.4-A, on accepting the composition to pay the composition tax under S.5, the liability to pay show-tax is not absolved of. Since the show-tax is in addition to the entertainment tax, be it on the basis of gross collection capacity of each show or on consolidated basis, the liability to pay show-tax still subsists. Therefore, the petitioners are not entitled to the declaration sought for. He placed reliance on Alankar Theater Warangal and others v. Entertainment Tax Officer, Warangal, (W. P. No. 6440/84 and batch dated July 19, 1984) decided by our learned brothers Jeevan Reddy and Anjaneyulu, JJ. When the matter has come up before the Division Bench consisting of My Lord, the Honourable Chief Justice, and my learned brother (sic). As there is an arguable point involved, for an authoritative pronouncement, the above question has been referred to the Pull Bench.