2021 (7) TMI 394 - HC - Indian Laws

Entertainment Tax - Validity of Government Order passed in G.O.Ms.No.89, Commercial Tax - validity of Registration Department dated 21.07.2011 and the consequential guidelines issued by the second respondent in proceedings dated 09.01.2012 - seeking exemption to the Petitioner's Movie under the Tamil Nadu Entertainment Tax Act - validity of Government Order passed in G.O.(D).No.90 dated 26.02.2014 - date of grant of exemption under Tamil Nadu Entertainment Tax Act from 26.02.2014 - validity of Government Order passed in G.O.No.002 dated 03.01.2012 - direction to constitute a new committee to view and recommend films for grant of exemption to entertainment tax - seeking appointment the Committees, grant of exemptions for movies and formulate a policy decision, which can work free from Favouritism, Nepotism and corrupt activities. HELD THAT - This Court is of the humble opinion that the Governmental institutions have no heart and life of its own. It remains as a building with infrastructures. It is the women and men of integrity, who injects heart and soul to these institutions for the welfare and benefit of the common people - the institutional integrity includes the engagement of authorities possessing the virtue of integrity and honesty. Once the individual's character is lost, the institutional values are lost, the credibility is lost and therefore, the governmental approach in these aspects must be cautious and in consonance with the constitutional perspectives. The mechanism of control must be far more transparent than that of the system prevailing now. Unless effective steps are taken, the constitutional mandate of effective public administration cannot be provided to the citizen of this great Nation. Thus, this Court has no contrary opinion regarding judicial restraint to be exercised in administrative policies. However, the Courts are bound to express its anguish regarding the happenings in the public Administrations. That exactly is the reason why there is a clash between judicial restraint and judicial activism. Undoubtedly, the Court cannot run the Government. However, the High Court has got a constitutional duty to protect the constitutional principles and the values - While exercising the constitutional powers, Courts cannot close its eyes in respect of such happenings in the public administration. The Government of the day irrespective of the political parties, must think about all these aspects. As far as the present writ petitions are concerned, this Court could easily visualize the possibilities of Favouritism and discrimination - However, for want of evidences and in view of the fact that there is no specific malafide allegations against the persons, this Court is unable to consider the relief as such prayed for. However, the Committees overall exercise was improper as the members of the Committee have certain personal affinity with the Government or the Political leaders, who were ruling the State. The Government of the day is expected to consider the following aspects and appoint Committees and authorities in Government organizations and institutions. (1) The women and men of integrity having merit must be selected and appointed in Expert Committees, Governmental organizations and institutions etc., (2) Integrity and honesty must be the criteria, which is to be assessed at the first instance and the merits are to be considered. When the merits are being equal priority, should be given to the integrity and honesty. (3) All such selections and appointments are to be made in a transparent manner and by providing equal opportunity to all the eligible women and men, who all are eligible for such appointments. All such selection and appointments are to be made beyond the Political affinities, aspirations and ideologies, keeping in mind that it is public appointments. (4) If each Political party appointing their own men in such Expert Committees, if allowed to be continued, then there is no scope for revival of social justice, equality in opportunities, merit and integrity. The Government is expected to revisit the entire process and appointment the Committees, grant of exemptions for movies and formulate a policy decision, which can work free from Favouritism, Nepotism and corrupt activities, enabling the people of this great Nation to get social justice from the Government of the day - Petition disposed off.

Summary

Issues Involved:
1. Validity of Government Orders and guidelines for exemption from entertainment tax.
2. Allegations of discrimination and favoritism in granting tax exemptions.
3. Constitution and functioning of the Committee for granting tax exemptions.
4. Impact of political affiliations on the decision-making process.

Detailed Analysis:

1. Validity of Government Orders and guidelines for exemption from entertainment tax:
The petitioner challenged multiple Government Orders (G.O.(d).No.159 dated 16.04.2012, G.O.Ms.No.89 dated 21.07.2011, G.O.Ms.No.474 dated 30.10.2012, G.O.Ms.No.557 dated 10.10.2013, and G.O.(D).No.90 dated 26.02.2014) and the consequential guidelines issued by the respondents. The petitioner contended that these orders imposed additional conditions for granting tax exemptions that were discriminatory and not in line with the objectives of the Tamil Nadu Entertainments Tax Act, 1939.

2. Allegations of discrimination and favoritism in granting tax exemptions:
The petitioner alleged that the respondents discriminated against their movies, which were produced and distributed by a firm associated with a political figure, Mr. Udhayanidhi Stalin. It was claimed that despite fulfilling the criteria for tax exemption, the petitioner’s applications were either delayed or rejected without valid reasons. The petitioner highlighted instances where movies with English titles were granted exemptions, indicating favoritism and nepotism.

3. Constitution and functioning of the Committee for granting tax exemptions:
The petitioner questioned the constitution of the Committee responsible for viewing and recommending movies for tax exemption. It was argued that the Committee members were appointed based on political affiliations rather than merit, leading to biased decisions. The petitioner was forced to file multiple writ petitions to compel the Committee to consider their applications, demonstrating the procedural irregularities and delays.

4. Impact of political affiliations on the decision-making process:
The judgment acknowledged the petitioner’s concerns about favoritism and nepotism, noting that the Committee’s recommendations and the Government’s actions were influenced by political considerations. The Court expressed its dissatisfaction with the manner in which the Committee was constituted and functioned, emphasizing the need for appointing individuals of integrity and honesty to uphold the principles of social justice and equality.

Conclusion:
The Court recognized the petitioner’s grievances regarding discrimination and favoritism in the grant of entertainment tax exemptions. However, due to the lack of specific evidence and the passage of time, the Court refrained from overturning the Committee’s decisions. The judgment underscored the importance of appointing individuals of integrity to public positions and called for a transparent and merit-based selection process to prevent favoritism and nepotism. The writ petitions were disposed of, with the Court urging the Government to revisit and reform the process of granting tax exemptions to ensure fairness and adherence to constitutional values.