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TMI Blog2020 (5) TMI 607X X X X Extracts X X X X X X X X Extracts X X X X ..... ficial and a distinction without a difference. By purchase of a ticket online the petitioner obtains only a single vested right that of entry to the theatre and the amounts collected from the petitioners, the seating and booking charges are both relatable to the same entertainment event. A vehicle is part of the facilities offered and serves to improve or enhance the experience of the entertainment provided as compared to a squatter who could well walk into a drive-in theatre and sit on the seating provided to watch the film. The experience is rendered more pleasurable and the facility offered becomes intrinsic to the process of watching the film itself. Thus, the receipts from such additional facility/benefit should stand encompassed within the charge - Extending this reasoning to the case before me, the access to online booking again indisputably facilitates and smoothens the access to the entertainment. Though there are other modes of booking available, a customer, when he opts for the online booking facility makes a conscious choice as opposed to standing in a queue before a booking counter or deputing another who would purchase the tickets on his behalf. The facility of b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n short TNVAT Act ) and on the basis that the Entertainment Tax in terms of Section 3(7) (c) of the Tamil Nadu Entertainment Tax Act, 1939 (in short TNET Act ) had not been remitted in respect of internet booking charges for various assessment periods. 4. The Assessing Officer notes that the ticket fare as fixed by the Government of Tamil Nadu was ₹ 120/- and ₹ 100/- in respect of two classes of seats. However, the petitioner had also charged a sum of ₹ 30/- per ticket as internet booking charges in cases where the booking had been made over the internet, which ought to have been offered to tax as well. In addition, charges had been levied for leasing of 3D glasses used for viewing movies in three dimension technology, and as such tax in terms of Section 4 of the TNVAT Act, dealing with the right to use goods also remained to be paid. 5. The petitioner replied objecting to the proposals and stating that only such payments that were relatable to the entertainment per se, and that were remitted as consideration or a condition for entertainment, would be liable to tax. They relied on various provisions of the TNET Act, in support of their case. Though su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e website. Otherwise seat allocation for movie tickets purchased via this website is on a 'best available' basis and is carried out by a prescribed computed program. By purchasing movie tickets via this website you agree that:' 10. When a consumer accesses the website of SPI Cinemas and accepts the above conditions, the portal presents to him the available options for films and seating. Upon the making a choice, a ticket is issued, wherein the ticket amount is stated as either ₹ 100/- or ₹ 120/- as per the norms issued by the State Government in this regard. In addition, a ticket booking charge of ₹ 30/- per ticket is also reflected. There are also provisions for a fee for 3D glasses usage, if applicable to the relevant film, any food items ordered, a donation, if the consumers so desires, and a provision for discount. The total amount is then displayed with the payment modes stipulated. 11. The petitioners state that they have adhered to the norms issued by the State Government for seat booking charges on the basis of which a consumer is admitted inside the Theatre . The phrase admission to an entertainment is defined in Section 3(2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consumer may make a booking apart from booking counters located in multiplexes. If these were availed, then the question of online booking charges would not come into the picture at all. Thus the petitioners levy an additional charge upon a consumer only when he opts for the online facility and these charges are necessary to defray the expenses incurred by the petitioner for offering this facility to a consumer. They point out that the online booking facility is hosted by third party service providers, such as, BookMyShow and other similar portals, which charge the petitioners a fee for hosting the booking portal. This has to be re-compensated and hence the online booking charge. 16. They rely on Rule 83(1A)(a) of the Cinema Regulation Rules 1957, that states that the licensing authority shall fix the actual rates of admission to each class of accommodation provided in the auditorium after taking into account the proposals of the licensee, the amenities provided in the theatre, the prevailing rates of admission in similar theatres in similar localities within his jurisdiction and any other relevant factor. Moreover, Condition No.6 contained in Form C to the Rules stipulates the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rview of the Act if the admission rates for such entertainment does not exceed ₹ 6/-. In the facts of the case, when the admission rates for each individual ride did not exceed ₹ 6/-the petitioner could not have been denied the benefit of the said notification by resorting to an artificial method of computing the admission rate by taking into consideration the total income derived by the petitioner from the said amusement park, inclusive of admission tickets and dividing the same by the number of visitors and taking such figure to be the admission rate. In the opinion of this Court, there is no legal basis for such computation. 19. The above decision is irrelevant in the facts and circumstances of the present case insofar as the Division Bench in Gujarat was concerned with the levy of entertainment tax on an amusement park and the rides contained therein and not online booking charges levied by a multiplex in regard to a theatre contained therein. The Bench was concerned with the whether the receipts from entry tickets to the amusement park that housed various rides , each ride being ticketed separately, was chargeable to tax under the provisions of the Gujarat Ent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the play. In a case like the present one, a person who pays for an entry ticket thereby is not entitled to avail of the benefit of any ride, he only avails of the facilities provided at the amusement park. For getting entertainment, viz. rides, the visitor is required to purchase a separate ticket. Moreover for every ride, be it of the same kind or a different one, a different ticket is required to be purchased. Thus a ticket for a ride is more or less akin to a cinema ticket on the basis of which one can watch one film only. If one wants to watch another film or the same film again, a separate ticket would be required to be purchased. Purchase of a ticket for mere entry into an amusement park, like in the present case, without getting any kind entertainment on the basis thereof, not being a payment for admission to an entertainment would not be exigible to entertainment tax. Under the circumstances, when payment made for entry is not payment for admission to an entertainment the question of clubbing the same with tickets for rides does not arise, inasmuch as unless Section 3 is applicable no entertainment tax can be levied. This decision is, thus, of no assistance to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry ticket can only be a sale of that chance. There is no other element. Every right can be sub-divided into lesser rights. When these lesser rights culminate in a legally recognizable right, it is the latter which defines the right. The right to participate in the draw is a part of the composite right of the chance to win and it does not feature separately in the definition of the word lottery . It is an implicit part of the chance to win. It is not a different right. The separation is specious since neither of the rights can stand without the other. A draw without a chance to win is meaningless and one cannot claim a prize without participating in the draw. In fact the transfer of the chance to win assumes participation in the draw. 46 . There is no value in the mere right to participate in the draw and the purchaser does not pay for the right to participate. The consideration is paid for the chance to win. There is therefore no distinction between the two rights. The right to participate being an inseparable part of the chance to win is therefore part of an actionable claim. 25. The distinction sought to be made came to be rejected, the Bench being of the vie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of expansion and not of contraction . 27. In the light of the above judgement, these arguments of the petitioners are rejected. Reliance upon the provisions of the Cinema Regulation Rules and the connected Forms also does not impress as it is nobody s case that the ticket price has been tampered with or modified. Admittedly, the ticket rate remains as fixed by the State. The challenge is only to the inclusion of the online booking charges to the rate for admission. The phrase payment for admission by definition includes (i) any payment for any purpose whatsoever connected with an entertainment which a person is required to make as a condition of attending or continuing to attend the entertainment and in addition thereto, (ii) payment, if any, for admission to the entertainment. The ticket rate fixed by the State falls within item (ii) as aforesaid and remains unimpacted by virtue of the issue under consideration, that falls within the ambit of item (i) aforesaid. 28. The Bhramastra of the Revenue is a judgment of the Supreme Court in the case of State of Karnataka V. Drive-in-Enterprises ((2001) 4 SCC 60), wherein the Bench considered the provisions of the Karnataka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was subsequently approved in Raza Buland Sugar Co. Ltd. v. Municipal Board, Rampur [AIR 1965 SC 895 : (1965) 1 SCR 970] the question arose as to whether the Municipal Board can levy water tax when the power to legislate was in respect of the land and building. The High Court held that in pith and substance water tax is not on water but it is a levy on land and building. 30. The Division Bench expressed its full agreement with the conclusions as above holding that it was not the nomenclature employed that was decisive, but the nature, character and purpose of the enactment that would decide the competence of the Legislature to legislate upon a particular subject. Thus the imposition of a bridge tax was held to be encompassed within the legislative power to tax land. 31. At paragraph 12, the relevant provisions of the Karnataka Entertainments Act 1958, Section 2(i) that defined payment for admission , Section 3 that dealt with Tax on payment for admission to entertainments and Section 6 dealing with manner of payment of tax were extracted as under: 12. Section 2(i) defines 'payment for admission' which runs as under: i) any payment made by a person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cles inside the Drive-in-Theatre especially when it is argued that cars/motor vehicles are not the persons entertained. Section 3 which is charging provision, provides for levy of tax on each payment of admission. Thus, under the Act, the State is competent to levy tax on each admission inside the Drive-in-Theatre. The challenge to the levy is on the ground that the vehicle is not a person entertained and, therefore, the levy is ultra vires. It cannot be disputed that the car or motor vehicle does not go inside the Drive-in-Theatre of its own. It is driven inside the Theatre by the person entertained. In other words the person entertained is admitted inside the Drive-in Theatre along with the car/motor vehicle. Thereafter the person entertained while sitting in his car inside the auditorium views the film exhibited therein. This shows that the person entertained is admitted inside the Drive-in Theatre along with the car/motor vehicle. This further shows that the person entertained carries his car inside the Drive-in- Theatre in order to have better quality of entertainment. The quality of entertainment also depends on with what comfort the person entertained has viewed the cin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x to be levied was rejected. 34. A vehicle is part of the facilities offered and serves to improve or enhance the experience of the entertainment provided as compared to a squatter who could well walk into a drive-in theatre and sit on the seating provided to watch the film. The experience is rendered more pleasurable and the facility offered becomes intrinsic to the process of watching the film itself. Thus, the receipts from such additional facility/benefit should stand encompassed within the charge. 35. Extending this reasoning to the case before me, the access to online booking again indisputably facilitates and smoothens the access to the entertainment. Though there are other modes of booking available, a customer, when he opts for the online booking facility makes a conscious choice as opposed to standing in a queue before a booking counter or deputing another who would purchase the tickets on his behalf. The facility of booking a ticket with the click of a button, seated in the comfort of one s home is a conscious choice that comes at a cost and without doubt, enhances the experience of watching a film. 36. The petitioners have also pointed out that the internet and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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