FICCI-Multiplex Association of India Vs State of Maharashtra (Bombay High Court)
Bombay High Court held that seventh proviso in Section 2(b) of the Maharashtra Entertainments Duty Act (MED) is constitutionally valid and entertainment duty leviable on convenience fees collected for online ticket booking.
Facts- The petitioners are challenging the insertion of the seventh proviso in Section 2(b) of the Maharashtra Entertainments Duty Act (MED) by the Maharashtra Act No.XLII of 2014, which received assent of the Governor on 29 December 2014.
The petitioner no.1 is an Association of Multiplex Theatres in which there is more than one screen for exhibiting a movie/film. To watch a movie, a person must buy a ticket, which entitles him to watch the film. Before the advent of internet technology, a person who wished to watch a movie had to go to the theatre and buy a ticket. However, with rapid advancement in technology, the theatre owner invested in technology so that a person who wished to buy a ticket to entertain himself by watching a film/movie, did not need to be physically present at the theatre to buy the ticket, but could buy the ticket at his own convenient time and from his convenient location by logging into the online portal of the theatre owner. However, if a person desired to buy the ticket online from the portal of the theatre owner at his convenience, then in addition to the price of the ticket, he was required to pay a certain extra sum known as ‘convenience fees/charges/service charges’. For e.g., if a person wishes to watch a movie by buying a ticket at the counter, then he has to pay Rs.100/-, but if a person desires to buy a ticket online to watch a movie, then he has to pay Rs 120/-, i.e. Rs.100/- being the cost of the ticket and Rs.20/-being the convenience fees for booking the ticket online. By the impugned proviso, the State seeks to recover entertainment duty on Rs. 20/- by treating the same as ‘payment of admission.’ The counsel showed us one document for the petitioners in Writ Petition No.1813 of 2016, which is a consolidated invoice issued giving a break-up of the cost of the ticket and convenience charges for online ticket booking. It is on this backdrop that the petitioners have challenged the impugned proviso before this Court, as not only is it ultra vires but also contrary to the scheme of the MED Act.
