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TMI Blog1990 (2) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... paise per sold ticket. By the same notification that imposed the entertainment tax, bye-laws relating to the entertainment tax were also notified. Jaswant Theatre, through its partner, impugned the imposition of entertainment tax as well as show tax being unconstitutional, inter alia, on the grounds (1) that no machinery for its assessment has been provided in the notification, and (ii) provisions of section 61 and section 62(2) of the Punjab Municipal Act, 1911, were not complied with, i.e., notice inviting objections did not define the class of persons, the description of property proposed to be taxed and the system of assessment to be adopted. The imposition was alleged to be arbitrary, oppressive and confiscating in character. No opportunity of hearing was granted to the writ petitioner either before enhancing the rate of show tax or imposing the entertainment tax. The appellant controverted the submissions made by the writ petitioner. The learned single judge held the notification to be invalid on the ground that it does not define the class of persons liable for payment of-tax, nor is there any description of property liable for tax, and further that no system of assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t since both the notifications do not specify either the persons liable for payment of tax or the property liable for tax nor has any system for assessment been mentioned, the imposition of tax is in violation of the mandatory provisions of section 62 of the Punjab Municipal Act, 1911, and cannot be sustained. It was contended that tax can be charged only if the charging provisions are clear and fix the liability of the tax on a person or persons. The liability of the assessees cannot be fixed by implication. Even payment of tax earlier cannot make person liable for tax in the absence of a clear charging provision. The charging provisions of the Act have to be clear. The tax cannot be imposed by analogies or inferences or after probing into the intention of the Legislature to implement the intention. The tax can be imposed by stating so clearly and there cannot be a tax by intendment. There is no equity in tax, nor is there any presumption with respect to tax. Learned counsel relied on a Division Bench judgment of this court in Civil Writ Petition No. 1993 of 1978 (Bhagwan Dass Bir Chand v. State Government of Punjab decided on December 20, 1979), wherein the notification couched ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-section (2) of section 61, the Deputy Commissioner shall submit the proposals and objections with his recommendations to the State Government. (8) The State Government, on receiving proposals for taxation under subsection (2), may sanction or refuse to sanction the same or return them to the committee for further consideration .... (10) (a) When a copy of an order under sub-sections (6) and (7) has been received, or (b) When a proposal has been sanctioned under sub-section (8), the State Government shall notify the imposition of the tax in accordance with such order or proposal, and shall in the notification specify a date not less than one month from the date of notification, on which the tax shall come into force. (11) A tax leviable by the year shall come into force on the first day of January or on the first day of April or on the first day of July or on the first day October in any year, and if it comes into force on any other than the first day of the year by which it is leviable shall be leviable by the quarter till the first day of such year then next ensuing. (12) A notification of the imposition of a tax under this Act shall be conclusive evidence that the tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of cinema.. 2. The tax shall be collected by the cinema authorities at the time of sale of cinema tickets by affixing the rubber stamp to be provided by the committee bearing the words 'Municipal entertainment tax'. 3. The proprietor of the cinema shall be responsible for submitting statement mentioning the number of sold cinema tickets along with tax collected up to the preceding day, on every Monday and Saturday of the week. 4. In case of breach or abetment of any bye-laws, the proprietor of the cinema shall be punishable by the magistrate with a fine which may extend up to Rs. 500 (sic) may extend to Rs. 5 for everyday after the first duration of the breach continued. Further, it would be advantageous to refer to Chapter VII of the Punjab Municipal Account Code, 1930, which promulgates the rules. After providing specifically rules relating to budget, structure of accounts, receipts, octroi and terminal tax, Chapter VII relates to other taxes. Chapter VII(1) of the Code relates to appointment and duties of a tax superintendent/tax inspector, as may be necessary for the assessment and collection of such taxes. The tax superintendent has been made responsible for the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e rate of tax ; and (iii) the system of assessment. The committee, after considering the objections and finally settling the proposal, was enjoined upon to forward a copy of its order through the Deputy Commissioner to the State Government in case tax is payable by the owner of a building and land not exceeding 15 per cent. of the annual rental value ; if the tax is on a person practising any profession or art or carrying on any trade in the municipal area. If the tax is of any other nature, then the proposal along with the objections was to be sent to the Deputy Commissioner The Deputy Commissioner, after taking into consideration the objections received by the Municipal Committee, has the discretion to refuse to sanction the proposal or return the same to the committee for further consideration or sanction them as such with or without modifications. The Deputy Commissioner is not authorised to increase the amount or rate of tax. The Deputy Commissioner is enjoined upon to send a copy of the proposal as well as his order to the State who would either sanction or refuse to sanction or return the case to the committee for reconsideration. After taking a decision with respect to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lete guidelines have to be provided within the four corners of which the collector of the tax is required to act. The assessee has to merely look at the statute and what it clearly says ; there cannot be any tax by intendment. Nothing can be read and nothing can be employed except to look fairly at the language used in the statute imposing the impost. Testing the said notification on the above principles, we are of the opinion that the imposition of show tax suffers from vagueness as far as the persons liable to be taxed and the event of liability is concerned apart from the fact that no system for assessment has been provided for. Thus, the imposition of show tax cannot be sustained. With respect to entertainment tax, learned counsel for the appellant contended that the essentials of section 62 have been complied with in as much as, with the imposition of the tax, regulations defining the nature of the property to be taxed as well as the persons liable for the same have also been notified. The notification for imposition of tax and the regulations having been published simultaneously, have to be read together by adopting the principles of reading the notification in its pith and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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