IMPORTANT POINT
The definitions of 'entertainment' and 'payment for admission' under the Maharashtra Entertainments Duty Act are broad enough to encompass award functions and sponsorship amounts, while penalties must be clearly justified by statutory provisions.

ORAL JUDGMENT

Jitendra Jain, J. - By this petition under Article 226 of the Constitution of India, petitioner seeks to challenge an order dated 28th September 2007 by which the Appellate Authority has confirmed the demand of entertainment duty of Rs. 71,87,500/- and reduced the penalty from Rs.1,43,75,000/- to Rs. 71,87,500/-.

:Brief facts:

2. Petitioner is a company incorporated under Section 25 of the Companies Act, 1956 and engaged in the activities of promoting Indian Cinema and Television in India and Worldwide.

3. On 21st January 2006, petitioner organised 'APSARA' award function at Jamshedji Bhabha Auditorium for felicitating distinctive achievements in cinema and television. The said function was organised in association with Speed Bright, Sony TV, NDTV, Hungama Events, and Reliance Communications etc.

4. Reliance Communications, vide letter dated 29th December 2005, informed Respondents that they had entered into an agreement with petitioner for sponsorship containing details of offer and monetary value in relation to the said award function. The total monetary value worked out to Rs. 4.90 crores which was attributable to Free Commercial Time on NDTV channels, Press Advertisement, Internet, Venue Branding, and Collateral Branding etc. Reliance also informed that the sponsorship amount was Rs.2,87,50,000/-. However no tickets were sold but only guild members were invited to attend the function. On the day of award function, flying squad of respondents visited the function and observed that there were banners of Reliance and other companies which advertised brand name of 'Reliance' and other corporates and their products. The squad also, inter alia, reported dance being performed to Hindi cinema tunes. The report of the flying squad is not disputed by petitioner.

5. On 7th March 2006, Respondent No.2, Additional Collector, passed an order directing petitioner to pay entertainment duty of Rs.71,87,500/- and fine of Rs.1,43,75,000/- being two times the duty. The said order was challenged in appeal and the Appellate Authority on 17th April 2007 passed an order confirming the entertainment duty but reduced the penalty from Rs.1,43,75,000/- to Rs.71,87,500/-. Against the said appellate order, Writ Petition No.1347 of 2007 was filed before this Court in which an order came to be passed remanding the order passed in appeal back to the Appellate Authority for passing speaking order.

6. Pursuant to the aforesaid order of this Court, the present impugned order came to be passed on 28th September 2007 confirming the entertainment duty of Rs.71,87,500/- and reducing penalty to Rs.71,87,500/- from Rs.1,43,75,000/-. It is in this backdrop, petitioner is before us. Petition was admitted and Rule issued vide order dated 7th December 2007. The Petitioner was directed to give bank guarantee of Rs.15 Lacs to be kept alive pending the final disposal. The Petitioner has complied with the same.

Submissions of Petitioner:

7. Petitioner submits that the 'APSARA' award function does not fall within the definition of 'entertainment' as defined by Section 2(a) of the Maharashtra Entertainments Duty Act ('the said Act') [earlier known as Bombay Entertainment Duty Act]. Petitioner further submits that the said Act inserted the definition of 'Award Function' by insertion of Section 2(a-3) by Mah. 2 of 2010 and therefore, the said function which was held prior to 2010, was never intended to be covered by the definition of 'entertainment.' Petitioner further submits that the said Act does not provide for pro rata assessment and charging on intermittent performances between 2 awards and therefore, machinery provision fails and consequently there cannot be a charge in such a scenario. Petitioner further submits that the amount received from Reliance Communication cannot fall within the definition of 'payment for admission' as contemplated in Section 2(b) the said Act. Petitioner further submits that activities being temporary, same is outside the purview of the