Facts:
M/s. Bramha Corp. Ltd (“the Petitioner or assessee”) is availing the benefit of exemption from Luxury tax under eligibility and entitlement certificate dated April 5, 2017, for the period of April 01, 2017 to March 31, 2027. The waiver was an incentive for the assessee to establish hotel within the State of Maharashtra.
However, after implementation of the Goods & Services Tax Act, 2017 (“GST”), the luxury tax was subsumed into GST and the benefit granted under the eligibility/entitlement certificate could not be given effect to, even though, the assessee had set up a hotel on the basis of the representation made by the State Government.
Issue involved:
Whether the waiver of entertainment & luxury tax applicable after the introduction of GST?
Held:
The Hon’ble Bombay High Court vide Writ Petition No. 1800 of 2019 dated July 30, 2019 noted the recommendation given by the High Level Committee pursuant to its order wherein it recommended to refund the quantum of SGST paid by the assessee during the period of incentive as per the entitlement certificate issued by the Tourism Department under the old policy, without increasing the incentive period. Noting that similar policy of refund of SGST to the eligible industrial units is implemented by the Industries Department under Industrial Promotion Subsidy scheme, Committee recommended to follow the same by the Tourism Department while implementing the refund scheme
The High Court referred to the case of Adlabs Entertainment Ltd. vs. U.O.I., wherein the issue was related to entertainment tax waiver, wherein it had on earlier occasion, directed the State Government to constitute a high-level committee to consider assessee’s representation seeking the benefit of incentive given under the erstwhile regime of waiving the entertainment taxes, as has been done by some other States.
Further, the High Court sought 12 week time to enable the State Government to take a decision on the recommendations of the High Power Committee. The High Court expected that State Govt. should take a decision to extend the benefit as suggested by the High Power Committee, across the board to all similarly situated parties. HC expressed that “This would bring about certainty and help in the equal application of the decision on all similarly situated parties”.Therefore, the High Court posted the matter on November 22, 2019.
Citation: [ TS-577-HC-2019(BOM)-NT ]