Fashion Design Council of India Vs Govt. of NCT of Delhi And Anr (Delhi High Court)
Delhi High Court held that the Entertainment Tax Act does not contain a mechanism for assessing and collecting tax on sponsorships. The imposition of a tax on sponsorship under the Entertainment Tax Act must fail in the absence of a specific charging provision.
Facts- FDCI is a society registered under the Societies Registration Act of 1860. It has been established and constituted to promote the growth and development of the fashion industry concerning the manufacture, design, marketing, and distribution of apparel and other accessories. Towards this end, the FDCI organises fashion shows.
FDCI avers that it has provided the necessary information concerning fashion show events held by it as required [being a non-ticketed event] in Form 6 prescribed under Rule 11 of The Delhi Entertainments and Betting Tax Rules, 1997. FDCI also asserts that in the past, it has sought and been granted exemption from payment of Entertainment Tax as per Section 14(3) of the Entertainment Tax Act.
It is a matter of record that FDCI received complete exemption from payment of Entertainment Tax between 2002 and 2007. However, vis à vis 2008-09, FDCI’s exemption was cut down to half.
