State of Kerala Vs M/s M Far Hotels Ltd. (Kerala High Court)
Charges received by the taxpayer for services at the Ayurveda Centre, Beauty Parlor, and Convention Centre within the hotel attract luxury tax
The Hon’ble Kerala High Court, Ernakulam in the case of State of Kerala v. M/s M Far Hotels Ltd. [O.P (Tax) No. 24 and 28 of 2016 dated June 04, 2024] held that charges received by the taxpayer for services at the Ayurveda Centre, Beauty Parlor, and Convention Centre within the hotel attract luxury tax under the Kerala Tax on Luxuries Act, 1976 (“the KLT Act”) because the services were not being rendered directly by the taxpayer, a third party was providing services to the customers in the premises of the Taxpayer.
Facts:
A Common Order dated August 4, 2015 (“the Impugned Order”), was passed by the Kerala Value Added Tax Appellate Tribunal (“KVATAT”) which dealt with Assessment Year 2003-04. Further, it disposed of four appeals preferred by the Revenue in relation to Assessment Years 2004-05, 2005-06, 2006-07 and 2007-08 and were decided against the State of Kerala (“the Petitioner”).
Hence, aggrieved by the circumstances, the Petitioner filed the present writ petition on the applicability of luxury tax on services provided to the customers at the hotel premises by the third party.
