The main legal point established in the judgment is that under the Tamil Nadu Entertainment Tax Act, 1939, only the cost paid for entry to attend the entertainment is subject to Entertainment Tax, and separate charges for additional services, such as online booking, are not taxable.

JUDGMENT :

Dr. Vineet Kothari, J.

(Prayer: Writ Appeals filed against the order of this Court in W.P. Nos. 34217, 34218, 34219, 34220, 34216 of 2015 dated 28.02.2020.)

1. Whether the “online booking charges” charged by a Cinema Hall Owner besides the “cost of ticket” for entry into the cinema hall and enjoy the entertainment in the form of a movie, is a part of taxable receipt by the Cinema Owner for the purposes of the Tamil Nadu Entertainment Tax Act, 1939, is the question which arises for our consideration in the present intra court appeals, filed against the order of the learned Single Judge dated 28 February 2020, by which the learned Single Judge was pleased to dismiss the Writ Petitions of the Cinema Owner, M/s.SPI Cinemas Pvt. Ltd., popularly known as 'PVR Cinemas', and hold that the entire price of the ticket when booked online through the Web Portal of the cinema owner by the customer would be exigible to the Entertainment Tax under the provisions of the Tamil Nadu Entertainment Tax Act.

2. The Tamil Nadu Entertainment Tax Act, 1939, is a pre-Independence Legislation, enacted at the point of time in the history when nobody had even conceived the idea of Internet, Web Portal or concepts like online bookings of cinemas. The Preamble to the said Act published in the Fort St.George Gazette on 20 June 1939 states, 'it is expedient to provide for the levy by the Government of taxes on entertainment and to repeal the Madras Local Authorities Entertainments Tax Act, 1926, and to provide for the payment of compensation to the local authorities now levying a tax under the Act aforesaid'. After Independence, the relevant words were substituted in the said Act of 1939 which continued to operate even after Independence, to introduce words “State of Tamil Nadu” at the appropriate places. Certain definitions to give perspective to this enactments after the advent of Internet etc. were added by the Amendment Act of 1998, and the definitions of 'Amusement', 'Antenna', 'Cable Television', etc. were introduced in the said enactment. Sub Section (4) of Section 3, which defined the term “Entertainment” as substituted by Act V of 1958 stipulated that “Entertainment” means “a horse-race or cinematograph exhibition to which persons are admitted on payment or television exhibition for which persons are required to make payment by way of contribution, or subscription, or installation or connection charges or any other charges collected in any manner whatsoever ...”.

3. The most relevant provisions, which we are called upon to interpret is the definition given in Section 3(7) of the Act read with the charging provision contained in Section 4 of the Act, which are quoted below for ready reference :-

(7) “Payment for admission” includes -

(a) any payment made by a person who, having been admitted to one part of a place of entertainment, is subsequently admitted to another part thereof, for admission to which a payment involving a tax or a higher tax is required;

(b) any payment for seats or other accommodation in a place of entertainment [***];

(c) 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 in addition to the payment, if any, for admission to the entertainment; [and]

[(d) any payment deemed to have been made under sub-section (1-A) of section 4 in respect of any taxable complimentary ticket,

But shall not include such maintenance charge which the licencee of cinematograph exhibition is permitted to collect, by order of the Government, from time to time, under the Tamil Nadu Cinemas Regulation Act, 1955 (Tamil Nadu Act IX of 1955) and collected by the said licencee;

4. Section 4, the charging provision in the said Act refers to the term defined above in Section 3(7) of the Act in the heading itself and the Section provides for tax on payment for admission to entertainments. Section 4 is quoted below for ready reference :-

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