The main legal point established in the judgment is the recognition of compelling circumstances justifying the closure of the Cinema Hall and the applicability of the doctrine of frustration in the context of the Entertainment Tax Act.

Heard Sri Akhilesh Kalra, learned counsel for the petitioner and learned Standing Counsel for the respondent Nos. 1 to 5. Notices have already been served on re­spondent No.6.

2. Under challenge are order dated 29th July, 2004 passed by State of U.P., respon­dent No.l, the order/recovery citation dated 24th May, 2004 passed by Additional Dis­trict Magistrate (Finance & Revenue), Agra and the order dated 6th August, 2001, the or­der of assessment of Entertainment Tax by the revenue authorities. The petitioner has sought that the recovery of Entertainment Tax for the period when his Cinema Hall situate in the city of Farrukhabad, U.P. had remain closed due to attachment and sealing by the Bank of Baroda branch at Agra. No entertain­ment tax be recovered from the petitioner for the said period. Due to statutory closure for the recovery of the banks loan, the Cinema Hall could not be run by the petitioner for a long period. It is still lying closed. No films were exhibited in the hall as such there was no question of recovery of Entertainment Tax from the petitioner. The Entertainment Tax ought not to have been levied.

3. As per learned counsel for the petitioner, the State Government had issued a Govern­ment Order on 18.7.1989 encouraging con­struction of modern permanent Cinema Halls in the areas where population is less than one lakh and made provisions for providing "grant-in-aid", exempting the Cinema Hall to pay Entertainment Tax. The new halls were constructed under the scheme as spelt out in Clause 4 of the aforesaid Government Order. The Cinema Hall owner, beneficiary was re­quired to give an undertaking that he would run the Cinema Hall for a minimum period of 5 years and in violation of this condition the District Magistrate may recover the "grant-in-aid" as arrears of land revenue. The petitioner took benefit of the "grant-in-aid" scheme, he established a Cinema Hall i.e. "Archana Talkies" at a small town Samsabad in District Farrukhabad. He had completed all the necessary formalities and the Cinema Hall was brought in the "grant-in-aid" scheme and the said benefits were'to be accorded to film exhibitors.

4. Since the petitioner was a small entre­preneur , he had taken a loan tor construction of the Cinema Hall from Bank of Baroda, Lawyers Colony branch Agra. The Cinema Hall was running peacefully in Samsabad town, however, the petitioner's family under­gone several unforeseen problems .and its fi­nancial condition deteriorated due to losses caused in running the Cinema. Samsabad being a small town was having less cinegoers. In later years because of onslaught of CD players, VCD players and DVD players, pi­rated videos, cable TV adverse effect was caused on Cinema Halls in Uttar Pradesh es­pecially in small towns like Samsabad. Things had deteriorated. Due to losses the petitioner could not repay the loan amount which was to the tune of Rs.17.60/- lakhs. The creditor, Bank of Baroda filed regular suit No. 176/1994 for recovery of their loan. The Cinema Hall had also faced technical prob­lems in running the Cinema Hall. There was technical fault in cinema projector, machines, the pictures could not be shown, the electric­ity bills inflated and Cinema Hall ran into losses since no films were being exhibited. The petitioner had to close down, the Cin­ema Hall facing immense difficulties.

5. The respondent No.5- District Magis­trate on 26.10.1994 issued a notice to the pe­titioner to exhibit films or else "grant-in-aid" would be recovered. The petitioner submit­ted a detailed reply to the notice of 11.11.1984 indicating therein the above compelling rea­sons, difficulties, technical fault in the ma­chines, projector due to which the Cinema Hall had to be closed down.

6. On the other hand, the Bank of Baroda which had already filed a suit for recovery of the loan obtained an attachment and sealing order from the Court on 24.10.1994. Since it was a judicial order of attachment and seal­ing of the property i.e. Cinema Hall, the pet

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