2017 (8) TMI 44 - HC - GST

Enforcement of the G.S.T. - Entitlement to collect entertainment tax as in the past upto 31st March, 2020 and to retain the percentage of it in accordance with the scheme - U.P. Entertainments and Betting Tax Act, 1979 - effect of C.GS.T. and U.P.G.S.T. Acts - Held that - Referring to petitioner that in view of Section 174 of the U.P.G.S.T. as there is no notification repealing the benefit conferred upon the petitioner under the scheme of the Act, he is entitle to collect entertainment tax as in the past upto 31st March, 2020 and to retain the percentage of it in accordance with the scheme and counsel appearing for the respondents No. 1 and 3 and Sri Krishna Agarwal, who has accepted notice on behalf of respondent No.2 are directed to file counter affidavit within one month. Two weeks thereafter are allowed to the petitioner for filing rejoinder affidavit. They would specifically answer if the scheme granting tax benefit to the petitioner is still continuing or stand revoked either automatically or by any fresh notification.

Summary

Issues:
1. Interpretation of Section 174 of U.P.G.S.T. Act regarding the continuation of benefits under the repealed U.P. Entertainments and Betting Tax Act, 1979.
2. Entitlement of the petitioner to collect entertainment tax and retain specified percentages under the scheme formulated under the repealed Act.

Analysis:
The judgment by the Allahabad High Court involved the interpretation of Section 174 of the U.P.G.S.T. Act in relation to the benefits granted under the U.P. Entertainments and Betting Tax Act, 1979. The petitioner, a partnership firm engaged in constructing Multiplex theatres, was permitted to retain a percentage of entertainment tax under a scheme valid until 31st March, 2020. The implementation of the C.G.S.T. and U.P.G.S.T. Acts from 1st July 2017 led to the repeal of the previous Act, with a saving clause preserving existing rights and benefits unless specifically rescinded. The petitioner argued that without a notification revoking their entitlement, they should continue to collect and retain entertainment tax as per the previous scheme until the specified date.

The Court directed the respondents to file a counter affidavit to clarify if the scheme granting tax benefits to the petitioner was still in force or had been revoked, either automatically or through a fresh notification. The petitioner was given the opportunity to amend the petition if necessary. The case was listed for admission/final disposal on 18th September 2017. The outcome of the judgment would depend on whether the benefits under the previous scheme were deemed to continue under the new tax regime or if any specific action had been taken to revoke them. The interpretation of the saving clause in Section 174 of the U.P.G.S.T. Act would be crucial in determining the petitioner's entitlement to collect and retain entertainment tax as per the earlier scheme.