2014 (11) TMI 1172 - HC - VAT and Sales Tax

Entertainment Tax - nature of the exhibition conducted by the petitioner - Held that - The exhibition conducted by the petitioner included live fashion show by designers which according to the petitioner is not an entertainment but promotion where instead of mannequins it was demonstrated by live models - There is a statutory appeal available to the petitioner before the Karnataka Appellate Tribunal on the order of the Joint Commissioner of Commercial Taxes. The petitioner has to exhaust his remedy before the Karnataka Appellate Tribunal before he approaches this Court - petition disposed off.

Summary

Issues:
1. Whether the exhibition conducted by the petitioner qualifies as entertainment under the Karnataka Entertainment Tax Act, 1958?
2. Whether the petitioner failed to comply with the statutory pre-requisite requirement for entertaining the appeal?
3. Whether the petitioner is liable to pay Entertainment Tax as imposed by respondent No. 2?
4. Whether the petitioner exhausted all available remedies before approaching the High Court?

Issue 1:
The petitioner argued that the exhibition, including a live fashion show, was for promotion and not entertainment under the Act. The contention was that the live fashion show was a promotional activity, not subject to Entertainment Tax.

Issue 2:
The Additional Government Advocate contended that the petitioner did not fulfill the statutory obligation required to appeal, as per Annexure-G. It was argued that the petitioner should have first approached the Karnataka Appellate Tribunal before seeking relief from the High Court.

Issue 3:
The petitioner challenged the imposition of Entertainment Tax by respondent No. 2, claiming that the exhibition was not entertainment and thus not liable for the tax. The appeal to the Joint Commissioner of Commercial Taxes was rejected due to the petitioner's failure to deposit 50% of the disputed amount.

Issue 4:
The High Court emphasized that the petitioner should exhaust all available remedies before approaching the court. It directed the petitioner to seek redressal at the Karnataka Appellate Tribunal before pursuing the matter further in the High Court, without expressing any opinion on the nature of the exhibition conducted.

In the judgment, it was noted that the nature of the exhibition conducted by the petitioner was crucial in determining the liability for Entertainment Tax. The court highlighted the statutory appeal available to the petitioner before the Karnataka Appellate Tribunal, emphasizing the need to exhaust this remedy before approaching the High Court. The court refrained from expressing an opinion on the entertainment aspect of the exhibition, directing the petitioner to pursue redressal at the Tribunal first.