M/S Multiplex Cinevision PVT LTD vs. State Of Uttarakhand

Held

The Court held that due to the introduction of a new tax regime, the Goods and Services Tax (GST), effective from July 1, 2017, the earlier exemption granted under the Government Order dated June 7, 2011, would no longer operate in favour of the petitioners. The Court acknowledged the petitioners' plea regarding compensatory schemes in other states. It granted the petitioners liberty to apprise the State Government of these facts and to convince them to introduce a similar scheme. The State Government was directed to consider the matter and pass appropriate orders in accordance with the law, expeditiously, preferably within twelve weeks from the production of a certified copy of the order.

Facts

The petitioners, M/s PVR Limited and M/s Multiplex Cinevision Pvt. Ltd., operate multiplexes in Dehradun and Rudrapur, Uttarakhand, respectively. They were granted exemption from entertainment tax for five years or until cost recovery, whichever was earlier, by a Government Order dated June 7, 2011. This exemption was formalized by the Entertainment Tax Department from January 8, 2015, to January 7, 2020. Following the introduction of the Goods and Services Tax (GST) regime on July 1, 2017, the earlier exemption ceased to operate. The petitioners have already availed the exemption for over two and a half years.

Key Issues

1. Whether the benefit of the prior entertainment tax exemption granted under the Government Order dated June 7, 2011, continues to operate in favour of the petitioners after the introduction of the Goods and Services Tax (GST) regime on July 1, 2017? Petitioner's contention: The petitioners argued that in similar situations in other states like Uttar Pradesh and Rajasthan, compensatory schemes were introduced to assist multiplex owners. They implicitly sought a similar recourse or continuation of benefits. Revenue's contention: The State Counsel argued that under the GST regime, nothing further could be done to accommodate the petitioners' claim for the prior exemption.