Dish Tv India Limited. Vs Joint Commissioner of Commercial Taxes (Appeals)-3 (Karnataka High Court)
Karnataka High Court held that entertainment tax and service tax are independent of each other. Thus, for the purpose of levy of entertainment tax, the ‘amount received or receivable’ cannot include service tax component.
Facts- Assessee is a Direct to Home (DTH) entertainment service provider in terms of DTH License dated 09.2003 w.e.f. October 2003. The DTH services are being provided under the brand name ‘Dish TV’. The short grievance of the Assessee is inclusion of service tax component in the ‘amount received or receivable’ while levying entertainment tax, in terms of Sec.4G of the Act.
The authorities did not agree with the Assessee that the service tax component cannot be included while computing the amount received or receivable whilst levying entertainment His appeals to the Tribunal against the same came to be rejected by the common order. That is how this Revision Petition is placed at our hands.
Conclusion- Held that the entertainment tax is levied and collected ‘on the amounts received or receivable’ by a Multi System Operator or Direct To Home service provider [DTH]. These amounts are nothing but the consideration which the customers would pay towards providing television signals under the DTH scheme. The transaction would obviously include both entertainment and service. Since both are discernible independent of each other, they are taxable separately; the entertainment is taxed under the provisions of 1958 Act whereas, the service is taxed under the provisions of Finance Act, 1994. The text, content & intent of section 4G leaves no manner of doubt that for the purpose of levy of entertainment tax, the ‘amount received or receivable’ cannot include service tax component. Had the legislature intended inclusion, the text of this provision would have been a bit different. Therefore, the question of law is answered in the negative and in favour of the Assessee.
