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2022 Supreme(Kar) 117
IN THE HIGH COURT OF KARNATAKA AT DHARWAD BENCH
Suraj Govindaraj, J.
Hubballi Dharwad Advertisers Association (R) NO.10B, 3rd Main, Padmashree Near Kamakshi Temple, Deshpande Nagar, Hubballi 580029, Rep. By Its President, Mr.Sandeep K Rokhade - Appellant
Vs.
State Of Karnataka Department Of Revenue Vikas Soudha Ambedkar Veedhi Bangalore Rep By Its Secretary - Respondent
Writ Petition No. 104172 Of 2021 (LBTAX)
Decided On : 21-04-2022
Advocate Appeared:
For the Appellant :Sri.U G Kattimani, Advocate And Sri.Zameer Pasha, Advocate.
For the Respondent:Sri.Shivaprabhu Hiremath, AGA, Sri.G.I.Gachchinamath, Advocate.
Point of Law : Article 246(A) of the Constitution of India is Special provision with respect to goods and services tax.
Headnote:
Constitution of India, 1950 – Article 246(A), 243X – Uttar Pradesh Goods and Service Tax Act, 2017 – Section 173 – Karnataka Municipal Corporations Act, 1976 – Section 134 – Per contra – Writ of prohibition or order or direction to respondents not to meddle with advertisement displays and hoardings of petitioners – Para 15.
Finding of the court: In present case, there is no challenge either to Section 134 of the Karnataka Municipal Corporations Act nor is there a challenge made to GST Act – Reliefs which have been sought for are for setting aside impugned demand notice at Annexure-A and a writ of prohibition directing respondents not to meddle with advertisement display and hoardings of petitioners.
Results: Writ petition is dismissed.
ORDER :
1. The petitioners are before this Court seeking for the following reliefs:
(i) issue a writ or order or direction setting aside the impugned demand notice vide Annexure A7 dated 13.06.2018 issued by the respondents.
(ii) issue a writ of prohibition or order or direction to the respondents not to meddle with the advertisement displays and hoardings of the petitioners.
2. Petitioner No.1 is a registered association of the advertising agencies and petitioner Nos.2 to 6 are the members of petitioner No.1. The petitioners claim to be in the business of advertisement on the advertisement hoardings licensed by respondent No.2-Hubballi Dharwad Mahanagara Palike. The petitioners are also stated to be registered as dealers under Section 22 of the Karnataka Value Added Taxes Act having received wide circulation in Form 7.
3. The petitioners claim to be making payments of advertisement tax regularly despite which the respondents have issued a notice dated 01.12.2014 at Annexure-A calling upon the petitioners to make payment of advertisement tax as regards advertisement hoardings used by them.
4. The contention of the petitioners is that on the enactment of the Goods and Service Tax Act (GST Act for brevity), the authority of the respondents to either levy or collect advertisement tax is ousted. Therefore, there could be no demand for advertisement tax post the enactment of the GST Act.
5. The respondents have collected the advertisement tax in terms of Section 134 of the Karnataka Municipal Corporations Act, 1976 (KMC Act for brevity). The power under Section 134 of the KMC Act flows from Entry 54, List II of Schedule VII of the Constitution of India. The said Entry 54 having been deleted the said power is divested. Hence, even on that ground no advertisement tax could be levied.
6. The respondents having no jurisdiction or authority to levy or collect advertisement tax after the enactment of GST Act the aforesaid reliefs are sought for.
7. Sri.Zameer Pasha, learned counsel appearing for the petitioners relies upon the decision of Allahabad High Court in Writ Tax No.354/2018 in the case of M/s Selvel Media Services Private Limited and Others vs. State of U.P. and Others wherein it is held that that in terms of Section 173 of the UPGST Act, 2017 which came into effect from 01.07.2017 it is GST which is liable to be paid. The power of the legislature to legislate with regard to advertisement tax had been deleted from the UP Municipal Corporations Act, with effect from 12.09.2016 there was no power left with the State Government or the Municipal Corporation for imposition of tax on the advertisement hoardings.
8. Relying on the said decision he submits that respondent No.2 also does not have any such power and therefore the demand at Annexure-A is required to be quashed.
9. Per contra, Sri.G.I.Gachchinmath, learned counsel appearing for respondent No.2 would submit that the power of respondent No.2 to collect the advertisement tax continues under Section 134 of KMC Act. In the decision relied upon by the counsel for the petitioner, said power had been deleted, whereas no such deletion has occurred in the KMC Act.
10. He relies upon the decision of Gujarat High Court in R/Special Civil Application No.4538/2019 and connected matters in the case of Selvel Media Services Private Limited vs. The Municipal Corporation to contend that advertisement tax is more of a fee though it has been termed as tax, it would have to be construed as a fee. This fee is levied for the license granted to the petitioner and its members to exhibit advertisements on the advertisement hoarding on the land belonging to respondent No.2 and or private parties. Without such license, the petitioner cannot display any advertisement, the fee is charged for such display and the same has nothing to do with GST as claimed by the petitioner. Both of them stand on different footings.
11. If it all the petitioners are aggrieved by the levy of GST, the petitioners have to challenge the
