RAM PRAKASH CINEMA Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) THIS order disposes of all above referred writ petitions as the questions involved in all these cases are common. M/s. Ram Prakash Cinema (hereinafter to be called as "the cinema") is carrying on the business of cinematograph exhibition and is assessed for the purposes of tax payable under the provisions of the Rajasthan Entertainments and Advertisement Tax Act, 1957 (hereinafter to be called as "the Act" ). The assessment under the Act is made on the basis of calendar month. In accordance with the provisions of section 6 (3), the assessee has applied that he may be allowed to make payment of entertainment tax due in accordance with the returns instead of making payment on the basis of stamps which were to affixed on each of the ticket. The provisions of section 6 (3) are reproduced as under : " 6 (3) Notwithstanding anything contained in sub-sections (1) and (2), the State Government, may, on the application of the proprietor of any entertainment in respect of which the entertainment tax is payable under this Act, allow such proprietor, on such conditions, as may be prescribed - (a) to compound the tax payable in respect of such entertainment for a fixed sum, or (b) to pay the amount of tax due - (i) by a consolidated payment of such percentage of the gross sum received by the proprietor or an account of payments for admission to the entertainment and on account of the tax, as the Government may fix, or (ii) in accordance with returns of the payments for admission to the entertainment and on account of the tax, or (iii) in accordance with the results recorded by any mechanical contrivance which automatically registers the number of persons admitted.

(2.) THE Government of Rajasthan has issued a Notification on July 9, 1959 in exercise of the powers under section 6 (3) of the Act, which reads as under : " Notification No. F. 7 (4)ET/58, dated May 7, 1959 In exercise of the powers conferred by section 6 (3) of the Rajasthan Entertainments Tax Act, 1957 (Act No. 24 of 1957), the Government of Rajasthan hereby prescribes, the following conditions on which the proprietors of divisional head quarters and Jaipur city may be allowed to pay the entertainments tax due in accordance with the returns of the payment for admission to the entertainments and on account of the tax, namely : CONDITIONs 1. THE proprietor shall deposit a reasonable security in cash in the Government treasury equivalent to the average amount of entertainment tax of one week. 2. He shall issue admission tickets in serial order, serial No. shall be printed on the tickets. No correction or modification shall be done in the tickets' printed number due to printing mistakes without prior intimation to the Sales Tax Officers or Assistant Commissioner, Excise and Taxation as the case may be and these will be done only in the presence of the Entertainment Tax Inspector who would also put his initials thereon. No book shall be brought into use for issue unless the first and the last tickets are sealed and signed by the Entertainments Tax Inspector concerned. 3. He shall clearly and separately specify on the admission ticket the rate of admission, amount of entertainments tax and their total. 4.THE admission ticket (not being a season ticket or ticket issued for more than one entertainment) shall be collected at the entrance of the purchaser in the entertainment hall and after tearing the ticket in two equal portions, one will be returned to the purchaser and the other retained by the management which shall be destroyed in the presence of the Entertainments Tax Inspector within 72 hours of the concerning show. 5.He shall not issue any torn tickets from booking office. 6.He shall maintain regular stock register of all the admission tickets (including complimentary tickets) of all classes which shall be signed and sealed on each page by the Entertainments Tax Inspector concerned. All fresh tickets as and when received from the press shall be entered in the stock register immediately. Entries about issue of series of tickets for the booking office shall be accounted for as and when given. Note regarding the exhaustion or close of a series shall be given when done with. 7.He shall issue a separate ticket equivalent to the value of different of the two classes in case the purchaser of any ticket wishes to change into a higher class. 8. He shall submit a daily collection report showing the number of tickets in form 'f' as prescribed under rule 17 of the Rajasthan Entertainments Tax Rules, 1957, on the following day to the Sales Tax Officer or the Assistant Commissioner, Excise and Taxation, as the case may be. THEse collection reports should be issued from the bound books bearing printed book No. and serial number. 9. He shall deposit the entertainments tax collected by him in the Government treasury in the appropriate head of account on the first day of each week, i. e. , Monday and if Monday happens to be holiday to the next working day. A copy of such treasury challan shall be enclosed with the daily returns to be presented to the officers mentioned in the condition No. 8. Failure to deposit the amount of tax will tantamount to an office within the meaning of section 10 (3) (c) of the Act, and without prejudice to the power vested in the Government to recover the due amount of tax. THE outstanding amount due from him shall be recoverable by the Sales Tax Officer or Assistant Commissioner from the amount of the security deposited under condition No. 1 above. 10. He shall show all account books to any officer authorised under Rajasthan Entertainments Tax Act, 1957, for inspection at all reasonable times and shall furnish other information pertaining to the entertainments when called upon to do so by the Sales Tax Officer or Assistant Commissioner, Excise and Taxation as the case may be including a return in form 'g' as prescribed under rule 17. 11. He shall make entries of the sale of tickets of different classes in the daily collection report before interval of the show and the return of the booking of each show shall be ready for inspection immediately after the interval. 12. Any officer of the Entertainments Tax Department no below the rank of an Inspector shall have power to check the account books, registers and other concerning record and all tickets or portions of tickets in the possession of the proprietor or any of his employees relating to the entertainments and if deemed necessary he may seize or freeze all or any of the above documents after preparing an inventory a copy of which will be given to the proprietor. 13. THE sanction shall be periodical and subject to renewal every year. Application for renewal shall be made in writing by the proprietors of the entertainment at least one month before the expiry of sanction. 14. Failure to comply with any of the aforesaid conditions shall make the proprietor liable to prosecution under section 10 of the Act and the concession of payment of entertainment tax through return system may also be withdrawn. 15. Regarding interpretation of the aforesaid conditions decision of the Commissioner, Excise and Taxation, Rajasthan, Udaipur shall be final and binding. "

(3.) DUE opportunity was given to the assessee before taking penal action and, therefore, it cannot be said that there was no any prejudice to the assessee and more so, this objection was never taken before the assessing authority or before the appellate authority. The stress of the learned counsel for the petitioner that the words "tax due" used in section 10 (3) (b) (i) refers to the amount of tax which is assessed and not the advance tax which is payable along with the returns has to be examined with reference to the other provisions of the Act. Section 5 of the Act provides that entertainment tax shall be levied in respect of each person admitted on payment and shall be calculated and paid on the number of admission, and mentions that entertainment tax shall be due and recoverable from the proprietor and the proprietor shall submit such returns relating to payment for admission to an entertainment to such authority. The provisions of sub-section (4) of section 6 provides that restrictions imposed by sub-sections (1) and (2) shall not apply to any entertainment in respect of which the tax due is payable in accordance with the provisions of sub-section (3 ). Sub-section (4) of section 6 makes it clear that payment under sub-section (3) of section 6 is in respect of tax due and, therefore, non-compliance thereof would be liable to penalty under section 10 (3) (b) (i ). Though the words "tax due" may refer to the tax which is due and payable on the basis of assessment as have been used in other Acts, but so far as the Rajasthan Entertainments and Advertisement Tax Act is concerned, the provisions of sub-section (4) of section 6 have made it clear that payment of tax required to be made under sub-section (3) of section 6 is in respect of tax due. The provisions of sub-section (4) of section 6 have not been challenged and, therefore, if the tax in accordance with the notification dated May 7, 1959 has not been paid, then it would be a contravention in accordance with the provisions of section 10 (3) (b) (i) of the Act. According to the notification dated May 7, 1959 the tax has to be deposited of the week on the next Monday.