Participants in sports and entertainment activities are liable to pay entertainment duty under The Punjab Entertainments Duty Act, 1955.

Hemant Gupta, J.

1. This order shall dispose of Civil Writ Petition Nos. 19345 of 2004, 19368 of 2004, 20002, 20003 & 20005 of 2004 and 443 of 2005, challenging the levy of entertainment duty under The Punjab Entertainments Duty Act, 1955 (for short the Act) as applicable to the State of Haryana.

2. In C.W.P. No. 19345 of 2004, the petitioner is a private limited Company, which has introduced and started a new activity of motor driving captioned Cyclone, Go-Karting at Faridabad. It is stated by the petitioner that the aim of the said activity is to educate and train people; to improve their driving skills and to teach the discipline skills during driving and competitions around any given track.

3. In all the cases, the petitioners have established resorts providing facilities for swimming, games of billiards, pool etc. and the entry is limited to members, who pay their subscription amount in lump-sum or on monthly/yearly basis. The issue in all these petitions is common as to whether such activity carried out by the persons, who are participating in the sports or such like activity, are liable to pay entertainment duty under the Act.

4. It is the case of the petitioner that the entertainment duty is payable by a person, who is being entertained i.e. the viewers of a sport activity, but one who is performing theatre or art or participates in artistic or participating in the sporting activity, is not liable to pay any entertainment duty, as he is a person who is entertaining the others. The members are the performers and, therefore, the entertainment duty is not payable by the performers, but by the viewers. In other words, the entertainment duty is payable by the third persons and not the participants themselves.

5. Before we examine the said contention in little detail, certain provisions of the Act are required to be reproduced:

2. Definitions.- In this Act unless the context otherwise requires- XXX XXX XXX XXX

(d) entertainment includes any exhibition, performance, amusement, game, sport or race which persons are ordinarily admitted on payment;

(e) payment for admission includes - (i) any payment made by a person admitted to any part of a place of entertainment and in a case where such person is subsequently admitted to another part thereof for admission to which an additional payment is required, such additional payment, whether actually made or not;

(ii) in case of free, surreptitious, unauthorized or concessional entry, whether with or without the knowledge of the proprietor, the payment which would have been made if the person concerned had been admitted on payment of the full charges ordinarily chargeable for such admission;

(iii) 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.

XXX XXX XXX XXX

(i) ticket means the pass or token for the purpose of securing admission to an entertainment.

3. Duty on payments for admission to entertainment: (1) A person admitted to an entertainment shall be liable to pay an entertainments duty at a rate, not exceeding one hundred and twenty five percent of the amount of payment for admission which the Government may specify, by a notification in this behalf, and the said duty shall be collected by the proprietor and rendered to the Government in the manner prescribed.

6. It may be noticed that the tax @ 125% has since been reduced to 25% vide notification dated 29.6.2001 in respect of other entertainments other than picture, cinematography exhibitions.

7. In the writ petition filed by M/s Chrysalis International (P) Ltd., the petitioner has relied upon an order passed by the Honble Supreme Court on 1.11.2002, whereby the matter was remitted back to the Appellate Authority under the Act in the case of petitioner itself. The learned Counsel also relied upon M/s Geeta Enterprises and Ors.