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TMI Blog2015 (11) TMI 354X X X X Extracts X X X X X X X X Extracts X X X X ..... ies/facilities provided also has to be treated as extra comforts and when the rental is above ₹ 5,000 for providing luxuries to be charged though it is sought to be argued by the petitioner's counsel that, what is provided under section 3C of the Act is only to attract charges on luxuries provided in marriage hall. - Though the petitioner had been exempted from paying tax on the ground that there is no provision provided under the charging section 3C, the petitioner cannot seek the aid and assistance of the Division Bench judgment rendered during January 2011 as the ratio laid down therein on January 22, 2011 (Indian Machine Tool Manufacturers' Association v. State of Karnataka [2011 (1) TMI 1253 - KARNATAKA HIGH COURT] is nullified by way of amendment which came into effect from April 1, 2012 and by virtue of the same, the exhibition halls also come within the definition of section 2(5B) of the Act and as such, exigible to luxury tax. - Decided against assessee. - Writ Petition Nos. 59421, 59422, 59423, 59424 of 2013 (T) - - - Dated:- 16-1-2015 - HULUVADI G RAMESH J. Arshad Hidayatullah, Senior Advocate for Thomas Vellapally for the petitioner. A. S. Ponnanna, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aka [2011] 42 VST 388 (Karn)), the Division Bench of this court categorically held that the BIEC building of the petitioner was conceived to showcase the promotion of sale of various industrial machinery manufactured by industrialists globally and not a building or part thereof where accommodation is provided for marriages or reception or matters related therewith so as to fall within the definition of the term marriage hall under section 2(5B) chargeable to luxury tax under section 3C of the Act. Despite the judgment of this court, the fifth respondent is again insisting on the petitioner paying luxury tax on charges received for letting out the BIEC during the period April 1, 2012 to November 26, 2012, on account of the amendment to the definition of marriage hall under section 2(5B) of the Act by the Karnataka Taxation Laws (Amendment) Act, 2012 which came into effect from April 1, 2012. According to the State, petition is not maintainable either on law or on facts and the petitioner has got alternative and efficacious remedy under the Act. It is stated, the petitioner already filed W. P. No. 49960 of 2013 with respect to the notice issued in respect of luxury tax, that m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted halls in its premises for renting the same for the purpose of running exhibitions, seminars, conferences, etc. With effect from April 1, 2012 although petitioners are liable to luxury tax, so far they have not registered under the Act and paid tax thereon. The judgment of the Division Bench of this court in W. P. 27454-56 of 2009 decided on January 22, 2011 (Indian Machine Tool Manufacturers' Association v. State of Karnataka [2011] 42 VST 388 (Karn)) referred by the petitioner is prior to the amendment made to section 2(5B) of the Act, i.e., April 1, 2012 and has no relevance to the present amended provisions. According to the respondent, the above judgment is not applicable to the case on hand as the amendment made to section 2(5B) is with effect from April 1, 2012 and the petitioner falls under the purview of luxury tax under section 2(5B)(ii) and (iii) and is liable to get registered under the 1979 Act and pay taxes. The charging section creates charge on the luxury provided to the marriage halls and is not restricted to luxuries only in respect of commodities or services for which other section has taken care. The charges for luxuries provided in a marriage hall have b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atters related therein. Despite the aforesaid binding inter parties judgment, the fifth respondent is insisting upon the petitioner to pay the luxury tax. It is also the argument of the senior counsel that the charge of luxury tax under section 3C of the Act is attracted only on the charges for luxury provided in a marriage hall. According to him, section 3C makes a distinction between charges for a marriage hall and charges for luxuries provided in a marriage hall and all charges for a marriage hall cannot attract the charge of luxury tax unless they qualify as luxuries. There is no definition of charges for luxuries provided in a marriage hall unlike the specific definition for charges for luxuries provided in a hospital under section 2(1C) or luxury provided in a hotel under section 2(5) or for luxuries provided in a club as per Explanation 1 to section 3D. Therefore, charges for luxuries provided in a marriage hall has to be read with the definition of luxuries under section 2(4B), i.e., services ministering to enjoyment, comfort or pleasure extraordinary to necessities of life as is held in the case of Godfrey Phillips India Ltd. v. State of U. P. [2005] 139 STC 537 (SC); [ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndian Machine Tool Manufacturers' Association v. State of Karnataka [2011] 42 VST 388 (Karn)). Of course in the case of Express Hotels Private Ltd. v. State of Gujarat [1989] 74 STC 157 (SC); [1989] 178 ITR 151 (SC); AIR 1989 SC 1949, the goods and articles which were chargeable goods under different category and which come under entry 62 of List II of the Seventh Schedule to the Constitution were distinguished. In the decision in Godfrey Phillips case [2005] 139 STC 537 (SC); [2005] 2 SCC 515, it is said, the goods and articles come under different entry and it cannot be chargeable and only service is chargeable. The submission of the respondent's counsel is, the concept of tax on luxuries underwent a sea change and it is an incorporeal aspect. The enjoyment of the comfort provided amounts to luxury and the decision in Magaji's [2006] 146 STC 473 (Karn) cited supra still holds the field. In view of the arguments advanced on behalf of the parties, this court has to consider whether the amenities provided by the BIEC which organizes business functions or exhibitions is chargeable to luxury tax and whether it falls within the expanded definition of marriage hall u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iz., business functions, official and social likewise, organizing exhibitions provided with luxury for seminar, convention and banquets or similar such activities are also covered. The exhibition halls come under the expanded definition of marriage hall and the very fixing of rental of not less than ₹ 5,000 per day is a criteria for imposing luxury tax. Further, what is being clarified in Godfrey Phillips case [2005] 139 STC 537 (SC); [2005] 2 SCC 515 is, only goods and articles provided cannot be charged and it is only services which are chargeable. The Division Bench of this court has not accepted the contention of the State in charging luxury tax. However, after amendment of section 2(5B) of the Act, the finding of the Division Bench has been undone by inclusion of exhibition halls in the definition of marriage hall . Though the petitioner had been exempted from paying tax on the ground that there is no provision provided under the charging section 3C, the petitioner cannot seek the aid and assistance of the Division Bench judgment rendered during January 2011 as the ratio laid down therein on January 22, 2011 (Indian Machine Tool Manufacturers' Association v. State o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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