2018 (5) TMI 762 - HC - GST

Entitlement of the assessee to collect Entertainment tax event after implementation of GST to claim benefit of exemption - retention of tax so as to enable it to recover the cost of construction of the Multiplex - Section 174 of the U.P.G.S.T. Act - Held that - respondent are directed to file counter affidavit within one month - Two weeks thereafter are allowed to the petitioner for filing rejoinder affidavit. List this petition for admission/final disposal in July, 2018.

Summary

Issues:
1. Interpretation of Section 174 of the U.P.G.S.T. Act regarding the continuation of tax benefits under the repealed U.P. Entertainments and Betting Tax Act, 1979.
2. Validity and applicability of the scheme permitting Multiplex owners to collect and retain entertainment tax for construction costs.
3. Determination of the petitioner's entitlement to collect and retain entertainment tax post the implementation of the C.G.S.T. and U.P.G.S.T. Acts.

Analysis:

1. The judgment revolves around the interpretation of Section 174 of the U.P.G.S.T. Act in relation to the tax benefits granted under the repealed U.P. Entertainments and Betting Tax Act, 1979. The petitioner asserts their entitlement to continue collecting entertainment tax as per the previous scheme until 24.11.2018, citing the absence of any notification rescinding the benefit conferred upon them. The court directs the respondents to clarify if the scheme granting tax benefits to the petitioner is still in force or has been revoked, either automatically or by a fresh notification.

2. The petitioner, a Company engaged in the construction and development of entertainment facilities, including Multiplex theatres, had been permitted to retain a percentage of entertainment tax under a scheme valid until 31st March, 2020. The District Magistrate of Meerut had specifically authorized the petitioner to retain entertainment tax to recover the construction costs of the Multiplex. However, with the implementation of the C.G.S.T. and U.P.G.S.T. Acts from 01.07.2017, questions arise regarding the continuity and validity of the scheme post-repeal of the U.P. Entertainments and Betting Tax Act, 1979.

3. The court's scrutiny extends to determining the petitioner's right to collect and retain entertainment tax following the enforcement of the C.G.S.T. and U.P.G.S.T. Acts. The petitioner's claim is rooted in the provisions of the repealed Act and the subsequent enactment, emphasizing the need for clarity on the preservation or revocation of the tax benefits under the earlier scheme. The upcoming proceedings are slated for July 2018, indicating the court's intention for a prompt resolution alongside another related Writ Petition.

This comprehensive analysis encapsulates the intricate legal nuances and pivotal aspects addressed in the judgment concerning the petitioner's entitlement to tax benefits under the evolving legislative framework.