I. WP(C) No.4477/ Versus-

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1 IN THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH) I. WP(C) No.4477/2014 M/s PVR Ltd., 61, Basant Lok, Vasant Vihar, New Delhi The State of Assam, Represented by the Commissioner & Secretary to the Govt. of Assam, Department of Finance & Taxation, Dispur, Guwahati The Commissioner of Taxes, Assam, Kar Bhawan, Dispur, Guwahati, Assam. 3. The Deputy Commissioner of Taxes, Zone A (Appeals), Kar Bhawan, Dispur, Guwahati The Superintendent of Taxes, Unit-D, Guwahati, Kar Bhawan, Dispur, Guwahati, Assam. II. WP(C) No.4480/2014 M/s PVR Ltd., 61, Basant Lok, Vasant Vihar, New Delhi Petitioner. Petitioner. The State of Assam and 3 others. III. WP(C) No.3439/ Mridul Properties (P) Ltd., G.S. Road, Bhangagarh, Guwahati Fun Cinemas, A unit of Petitioner No.1, HUB, G.S. Road, Bhangagarh, Guwahati The State of Assam and 3 others. Petitioners. WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 1 of 15

2 IV. WP(C) No.3440/ Mridul Properties (P) Ltd., G.S. Road, Bhangagarh, Guwahati Fun Cinemas, A unit of Petitioner No.1, HUB, G.S. Road, Bhangagarh, Guwahati The State of Assam and 3 others. Petitioners. V. WP(C) No.3443/ Mridul Properties (P) Ltd., G.S. Road, Bhangagarh, Guwahati Fun Cinemas, A unit of Petitioner No.1, HUB, G.S. Road, Bhangagarh, Guwahati The State of Assam and 3 others. Petitioners. VI. WP(C) No.3444/ Mridul Properties (P) Ltd., G.S. Road, Bhangagarh, Guwahati Fun Cinemas, A unit of Petitioner No.1, HUB, G.S. Road, Bhangagarh, Guwahati The State of Assam and 3 others. Petitioners. VII. WP(C) No.3445/ Mridul Properties (P) Ltd., G.S. Road, Bhangagarh, Guwahati Fun Cinemas, A unit of Petitioner No.1, HUB, G.S. Road, Bhangagarh, Guwahati The State of Assam and 3 others. Petitioners. WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 2 of 15

3 VIII. WP(C) No.4479/2014 M/s PVR. Ltd., 61, Basant Lok, Vasant Vihar, New Delhi The State of Assam and 3 others. Petitioner. BEFORE THE HON BLE MR. JUSTICE HRISHIKESH ROY THE HON BLE MR. JUSTICE PARAN KUMAR PHUKAN Advocate(s) for the Petitioner : Dr. Ashok Saraf Sr. Adv., Mr. P. Baruah, Mr. Z. Islam. Advocate(s) for the Respondents : Mr. D. Saikia, Addl. A.G., Assam, Mr. B. Choudhury, SC, Finance & Taxation. Date of Hearing : , , , Date of Judgment : 30 th August, 2016 Date of Judgment correction : [Hrishikesh Roy, J.] JUDGMENT AND ORDER Heard Dr. A. Saraf, learned Senior Counsel appearing for the petitioners in all the cases. Also heard Mr. D. Saikia, the learned Addl. Advocate General representing the respondents. 2. The petitioners operate multiplex/mini cinema halls and the issue here is their liability towards entertainment tax for the relevant period, under the Assam Amusement and Betting Tax Act, 1939 (hereinafter referred to as the Assam Act ). The concerned entities, hereinafter referred to as the Exhibitors commenced commercial operation in Assam between and therefore, by virtue of the Govt. Notification dated (Annexure-I), the exhibitors seek exemption from the liability to payment of tax, for a period of five years. The exemption notification was issued under Sub-Section (2) of Section 8 of the Assam Act. The petitioners in this batch of litigations can be divided in two groups. The first is the M/s. PVR Ltd. who have filed the WP(C) No.4477/2014, WP(C) No.4480/2014 and WP(C) No.4479/2014 and they claim that they have WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 3 of 15

4 not collected the tax, whereas the 2 nd group of M/s. Mridul Properties (P) Ltd., in the other five cases, have admittedly recovered the entertainment tax, from the movie-goers. 3. The cases have common facts and hence for the sake of convenience, the narratives in this order are extracted from the WP(C) No.4477/2014, filed by the M/s. PVR Ltd. BACKGROUND FACTS 4. Through the notice dated (Annexure-IV), the Superintendent of Taxes alleged that the Exhibitors were unauthorisedly collecting tax from the movie-goers and accordingly demand was made for deposit of the collected amount or else, tax would be assessed under the Assam Act. In their response, the first group contended that entertainment tax was not collected and accordingly they requested for recall of the tax demand notice. 5. Dissatisfied with the reply, a show cause notice for assessment under Section 5-A(2) of the Assam Act was issued on (Annexure-X), where it was alleged that tax is being illegally collected from the movie-goers, in spite of the exemption notification dated (Annexure-I), issued under Sub- Section (2) of Section 8 of the Assam Act. According to the notice, the claim of not charging entertainment tax made by the exhibitor is not believable, as the tickets issued for certain films, reflects the charging of tax. Hence, tax was proposed to be assessed under Section 5-A(2) of the Assam Act. 6. In response to the show cause notice, the exhibitor reiterated that they have not collected any amount towards entertainment tax and they offered to submit their Books-of-Account to support their contention. However through the assessment order dated , the tax was assessed on the basis of the total turnover and interest was also added to the assessed amount. 7. Being aggrieved, the exhibitors challenged the assessment through the WP(C) No.2343/2013 and this case was disposed of by the Division Bench on , by relegating the party to the statutory forum. Thereafter the appellate authority after considering the rival submission through the impugned order dated (Annexure-XXI), opined that when the tax is collected, the same should be deposited in the Govt. exchequer or else, it will amount to unjust WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 4 of 15

5 enrichment. It was also concluded that objective of exemption by the Government was to provide relief to the movie-goers and it is impermissible for the exhibitor to retain the collected tax as this would be contrary to the judgment of the Apex Court in the State of Maharashtra vs. Swanstone Multiplex Cinema Private Ltd. reported in (2009) 8 SCC 235. On the basis of such conclusion, the Appeal was dismissed on (Annexure-XXI), by the appellate authority and consequential direction was issued to realize the assessed tax and interest, from the exhibitor. 8. The other group under the M/s. Mridul Properties (P) Ltd. admits that entertainment tax was collected on the entry tickets but denied their corresponding obligation to deposit the collected sum on account of the exemption notification. Confronted with similar assessment and demand like the first group, the aggrieved exhibitors filed Revision Petition(s) against the assessment order passed by the Superintendent of Taxes. But since those were rejected by the common order dated (Annexure-XXII), the first group having realized the futility of revision, have decided to challenge the order in the High Court. SUBMISSION OF PETITIONERS 9. Dr. A. Saraf, learned Senior Counsel submits that tax is to be charged, levied and paid to the Government under Section 3 of the Assam Act. Here incentive to set up multiplex/mini cinema halls was provided by the Government by exempting the liability to payment of entertainment tax to those, who set up their projects in Assam during Accordingly it is argued that such incentive to the multiplex/mini cinema halls is intended to encourage business activities and since they are exempted from the tax liability, there can be no assessment for the exhibitors to tax, under Section 5-A of the Assam Act. 10. The petitioners refer to the fact that the exemption notice was issued under Sub-Section (2) of Section 8 of the Assam Act and therefore it is contended that there is no absolvement from charging tax but what is exempted is the liability from payment of entertainment tax and therefore it is argued that demand for tax from the exhibitors (whether realized or otherwise) is unauthorized, in the face of the exemption notification. WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 5 of 15

6 11. The senior counsel distinguishes the Swanstone Multiplex Cinema Private Ltd. (Supra) by submitting that present facts are different in as much as, in the case before the Supreme Court, the levy of entertainment tax was exempted and only incentives by way of zero or reduced rate of tax was provided under the policy, adopted by the Maharashtra Government. But here in Assam unlike the Maharashtra scenario, the beneficiary was exempted from payment liability towards the State exchequer. Therefore Dr. Saraf argues that it is not a case of unjust enrichment, since the charging of tax was not exempted by the Notification dated (Annexure-I). Hence the Assam situation is nothing but a business incentive for five years, for the new entrepreneurs in the field and retention of the collected sum is not unjust enrichment since this was permitted by the Govt. 12. The petitioners contend that assuming that assessment is permissible, for the petitioner M/s. PVR Ltd. (who did not realize the tax), the assessment can never be on the total turnover. But if there is any undue collection which can t be retained by the exhibitors, recovery would be permissible only through searching enquiry of each and every transaction and not through hypothetical conclusion, based upon the business turnover of the exhibitor. 13. Alternately Dr. A. Saraf argues that if charging of tax is exempted, then the amount collected by the second group can never be assessed as tax and then the recovery through assessment, is contended to be impermissible. 14. The substantial contention of the petitioners is that if the exhibitor is exempted from liability to payment of entertainment tax, retention can t be construed as unjust enrichment since it is nothing but an incentive for investment in the fresh field of multiplex and mini cinema halls, in Assam. SUBMISSION OF RESPONDENTS 15. On the other hand, Mr. D. Saikia, the learned Addl. Advocate General submits that the exemption notification was issued to encourage the cine-goers and not intended to benefit the cinema exhibitors and accordingly it is argued that the retention of the collected amount by the exhibitors is impermissible and the collected money has to be deposited in the state exchequer. WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 6 of 15

7 16. The respondents argue that tax is to be collected for entertainment of the movie-goers and the role of the exhibitors is only to collect the tax on behalf of the state. But when the tax is exempted under Section 8 of the Assam Act, the movie-goers are to be absolved and if any such tax is collected, the retention thereof in the hand of the exhibitors, will certainly be unjust enrichment. 17. The learned counsel for the Revenue submits that the benefit envisaged under Section 8 is for the movie-goers and the exhibitors are not the targeted beneficiary. In support Mr. Saikia refers to the manner of granting exemption, under the Assam Amusement and Betting Tax Rules, 1939 (hereinafter referred to as the Rules ). Under Rule 2(4) read with Rule 12, every Exhibitor is required to keep at the place of entertainment, the register books of tickets and also registers of payments for admission and the records of stamps denoting the entertainment tax purchased and used in prescribed formats. He refers to Form No.V, prescribed under Rule 20 which certifies tax exemption. The exhibitor is obliged to prominently display this certificate at the entry gate, so that the movie-goers are made aware that tax is not being collected for the show in question. From these provisions of the Rules, it is argued by Mr. Saikia that the benefit of exemption is not envisaged for the exhibitors but for the movie-goers. 18. The learned Addl. Advocate General refers to Section 72 of the Indian Contract Act, 1872 to argue that the exhibitors have the legal obligation to refund the mistakenly collected tax. 19. The respondents argue that by virtue of the exemption, the collection of tax from the movie-goer does not arise for the relevant period and therefore if any sum is collected by the exhibitors, the same is an unjust collection. Mr. Saikia cites Jay Vee Rice & General Mills vs. State of Haryana, reported in (2010) 10 SCC 687, to argue that when tax is unjustly collected, retention thereof by the agent is impermissible and the collected amount should either go back to the person from whom it was collected or it is to be surrendered to the state exchequer, as otherwise the retention by the exhibitor will amount to unjust enrichment. 20. The respondents rely upon the State of Karnataka vs. Drive-in Enterprises reported in (2001) 4 SCC 60, to contend that the levy is on the person who is entertained and therefore exemption should benefit of the person who is WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 7 of 15

8 entertained. It is thus argued that the retention of the illegally collected entertainment tax in the hand of the exhibitor would be legally impermissible. 21. Referring to fundamental principles of interpretation of taxing statute or exemption notification, Mr. Saikia reads Oil & Natural Gas Corporation Ltd. vs. Commissioner of Income Tax reported in (2015) 10 SCC 621, to contend that literal rule of interpretation must be followed without distorting the language and common sense approach in interpretation of the exemption notification can have no role. 22. To explain the role of the exhibitor, Mr. Saikia reads P. Sankara Narayanan vs. State of Tamil Nadu reported in MANU/TN/8821/2007, to contend that the exhibitors are only collecting agent of the tax on behalf of the state. Therefore when the tax is borne by the movie-goers and if the collection is held to be unauthorised, the retention/refund can be only to the person from whom the tax is realized but not to the exhibitors, who acts as agent on behalf of the state. 23. Mr. Saikia refers to the Govt. Notification dated , to contend that whenever tax is exempted under some incentive policy, the exemption notification lays down the manner and mode of disbursal of incentives. But here it was never indicated that the exhibitors are entitled to retain the collected tax and therefore it is argued that retention of the collected sum, can t be allowed. 24. The respondents lawyer refers to the assessment proceedings to contend that the exhibitors were given opportunities to produce the ticket counter-foils and also the other documents mentioned in the Rules but they failed to produce them, despite due opportunities. Therefore it is argued that the authorities had rightly made assessment on the basis of best judgment, as provided under Section 5-A(2) of the Assam Act. DISCUSSION AND CONCLUSION 25. The submission made by the rival Counsel have received our earnest consideration. 26. We find that the charging section of the Assam Act refers to charge, levy and payment of entertainment tax and the taxable event is on admission to entertainment. Under sub-section (6) of Section 3, the proprietor of the WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 8 of 15

9 entertainment is made liable to pay the tax. Three stages for imposition of tax was culled out by the Apex Court in Chatturam Holiram Ltd. Vs. CIT reported in AIR 1955 SC 619 and the stages are mentioned as under :- There is the declaration of liability, that is the part of the statute which determines what persons in respect of what property are liable. Next, there is the assessment. Liability does not depend on assessment. That, ex hypothesi, has already been fixed. But assessment particularizes the exact sum which a person liable has to pay. Lastly, come the methods of recovery if the person taxed does not voluntarily pay. 27. But what we notice from the Assam Act is that while the charge and the levy is on the exhibitors, the taxable event is on admission to entertainment. Hence the submission of the Revenue that tax here is on the person entertained appears to be illogical as this is not found in the charging Section 3 of the Assam Act. In the enactment we are considering, the payment is on admission to entertainment. Thus there is clear distinction in the manner, the legislative intent is expressed in the Act. The words used in the charging section doesn t say that the levy is on the person entertained and only through an interpretive exercise, the expression may be understood in that manner. But the question here is what was the intention of the law maker and whether there is any scope for an interpretative exercise. 28. In the present case, the assessing authority levied entertainment tax only on the ground that the petitioners in spite of the exemption having been granted, charged and collected entertainment tax and appropriated the same to itself. But even if the notification dated is construed to be exemption from charge and levy of entertainment tax, then also, in case any unauthorized collection was made, the assessing authority has no power and/or jurisdiction to levy the entertainment tax during the period of exemption. 29. In the above context, the Apex Court in M/s Pine Chemicals Ltd. Vs. Assessing Authority reported in (1992)2 SCC 683 declared that whether any amount has been collected unauthorisedly in spite of the exemption, what is the amount and whether it has been collected as tax etc., cannot be scrutinized, in a normal assessment proceeding. One of the contentions raised in the case before the Supreme Court was that there was a finding that, the assessee had collected sales tax in respect of its sale turnover for which exemption was claimed and as such, the said amount was refundable under Section 8(B) of the Jammu & WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 9 of 15

10 Kashmir General Sales Tax Act, The Court while leaving the question of applicability of Section 8(B) in that case open, held that whether any element of sale tax had merged in the fixation of the sale price and that amounts to collection of sales tax, would have to be decided in a separate proceeding that may have to be initiated under Section 8(B) of the said Act, if the State demands payment under the said provision of the Act. 30. In a similar situation, where the assessment was completed by levying tax during the period of exemption on the ground that in spite of the exemption being granted, the assessee charged and collected tax, this Court in Mahabir Coke Industries Pvt. Ltd. Vs. Commissioner of Taxes reported in (2003)5 GLR 175 quashed the orders of assessment by holding that if any allegation of unauthorized collection of tax is established, the consequences as provided in Section 65A of the Assam General Sales Tax Act, 1993 which related to forfeiture of the unauthorized collection of tax and/or Section 10 of the Central Sales Tax Act, 1956, as case may be, would follow. It was thus held that the impugned action of making a general assessment of all the transactions in exercise of powers under Section 17(4) and 9(2) of the 1956 Act and raise a demand for tax, without examining each and every transaction to determine whether any tax was at all collected, cannot be countenanced. 31. The words used in the statute should ordinarily be understood in their natural and grammatical meaning except when it is found to be inconsistent with the rest of the enactment. Departure from the golden rule of construction is impermissible unless there be something in the context, which warrants a deviation to avoid absurdity. But admission to entertainment is not the same as the person entertained. Hence if we construe the expression with its natural and common sense meaning, the levy is upon admittance to entertainment. Such construction does not clash in any manner even if we read the Assam Act as a whole and no incongruity or absurdity is discernible, if ordinary meaning is attributed to the expression used in the charging section. Therefore merely because entertainment tax is borne ultimately by the cine-goers will not permit us to import the words person entertained, when such words are missing in the enactment. WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 10 of 15

11 32. In fact if we take the analogy of other indirect taxation, the logic of the above manner of construction can be better appreciated. The charge and levy of central excise duty is on manufacturer but the tax burden is eventually borne by the consumer. Does it then mean that the charge and levy of excise tax is on the person who purchases the manufactured goods at a value which includes the component of excise duty, charged to the manufacturer. Similarly, levy of sales tax is on sale transactions but the tax is eventually borne by the purchaser. Can it then be said that charge and levy of sales tax is on the person who buys the product. The logical answer for both example is that charge and levy will continue to be on manufacturer (for central excise) and on seller (for sales tax) and in neither situation, the person who eventually pay the excise duty or sales tax, can be a factor, for roping in the purchaser, for constructing the charging section. They key words is admission in Section 3 of Assam Act and admission may refer to not only the person admitted (cine-goer) but also the one who admits (exhibitor). Therefore in our analysis, the person entertained and the person providing entertainment should stand together and this is possible only when, we interpret the words in the charging section in their natural meaning. In other words, admission to entertainment can t have the same meaning as the person entertained. Thus we hold that the decision in State of Karnataka vs. Drive-in-Enterprises reported in (2001) 4 SCC 60 will not apply in these cases in the context of the Assam Act. 33. The scheme of the Assam Act is that notwithstanding the collection of tax from the cine-goers, the liability to pay the tax remains with the exhibitors. To understand the implication thereof, we may again benefit by referring to the levy of sales tax where the charge is on the dealer. Similarly for central excise duty, the charge is on the manufacturer. But in both process, while the taxable event is sale or manufacture as the case may be, the tax is collected from the consumer. But non-payment of tax by the consumer is never a relevant factor to determine the liability of the dealer/manufacturer. Therefore tax liability and actual payment of tax are conceptually different. Thus in the event of exemption, since the entertainment tax liability is on the exhibitor, the target of exemption notification needn t be the cine-goers, merely because, tax is borne by him under the Assam Act. WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 11 of 15

12 34. The entry 62 of List-II of the 7 th Schedule empowers the State Legislature to levy tax, inter alia, on entertainment. Under the Assam Act, the taxable event is on admission to entertainment as is specified in the charging section 3. When the taxable event relates to entertainment, the levy and charge is not necessarily on the person entertained, who nevertheless have to bear the entertainment tax. On proper construction of the charging section which doesn t declare that the levy on the person entertained, it will be wrong in our understanding, to import words not found in the Assam Act. 35. It is important to keep in mind that charge and levy and the incidence of taxation are conceptually different. Under the exemption notification of (Annexure-1), charge and levy is not absolved and therefore it is difficult to accept that charging of tax is exempted by the State. This indirect tax is to be borne by the cine-goers on admission to entertainment but the liability to pay the tax to the State under the Assam Act, is on the exhibitors. So when the liability from payment of tax is exempted, the benefit in our understanding, should go to the entity which is made liable to pay the tax. Merely because the tax is ultimately borne by the cine-goers, exemption is not intended for them particularly when, the notification targets those exhibitors, who commenced commercial operation between to The different sections of the Assam Act must be harmoniously construed to understand the purport of the exemption notification issued under Section 8(2). The Section 3(6) imposes the liability to pay tax on the exhibitor and therefore when we construe Section 3(6) together with Section 18(3), it is logical to conclude that the benefit is intended for the exhibitors and was not meant for the movie-goers. 37. The next thing to consider is whether, in the context of the formats and certificates prescribed under the Assam Rules and more particularly Rule 8, it will be correct to conclude that the exemption is for the cine-goers. What is significantly different in sub-sections (1) and (2) of Section 8 is that each one operates on a different field. The sub-section (1) speaks of not charging tax on certain exigencies whereas sub-section (2) speaks of exemption from liability to pay the entertainment tax. When such distinction is made by the law makers in Section 8 itself, the formats and certificates specified under the Assam Rules has WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 12 of 15

13 to be understood in the context of the exemption under Section 8(1). Blind application of the prescribed forms, certificates and registers in the Assam Rules for the sub-section (2) exemption (where they do not fit in), will naturally lead to an absurd situation. 38. The plain reading of Rule 19 and 20 of the Assam Rules would show that the same is applicable only in respect of exemption granted under Section 8(1) of the Act. While the Rule 19 do make reference to Section 8 generally but if we read Rule 19 together with Rule 20 and Form V, it becomes clear that the Rules are not applicable for exemption granted under Section 8(2) of the Assam Act. In this connection, the contention of the petitioner gets fortified by the circular No.CTA-41/84/9 dated issued by the Commissioner of Taxes, Assam. The govt. circular says that the exemption is to be applied under Section 8(1) of the Act. The Rule 20 clarifies the issue further when it provides that the application for exemption has to be made not less than 30 days before the date of entertainment. When the Rules are framed for carrying out the purpose of the Act the provision of the statute cannot be interpreted on the basis of the Rules framed under the Assam Act. If a particular Rule does not fit in with a specific provision of the Act, the scope of the concerned section cannot be curtailed and/or widened, on the basis of the Rules. Such forced interpretation will in our view, subvert the clear words in the statute. In any case, the Rules are intended to support the Act and can t abrogate the Act. Therefore the argument raised to the contrary by the counsel for the revenue, is rejected. 39. Unambiguous intention is essential in fiscal statute. It is not stated anywhere in the Assam Ac that the exemption benefit was intended for the cinegoers. Therefore when nothing as such is mentioned, it will be erroneous to import words to construe the exemption notification, as a benefit for the cinegoers. It can t also be overlooked that cine-goers form a class of their own without any rational differentiation between those who watch movies in normal cinema halls and those in multiplexes. But there is clear distinction between two categories of exhibitors (ordinary cinema halls and multiplexes) where the quality of entertainment, ambience and comfort provided, are surely of two levels. The exemption notification speaks of those multiplexes which commenced commercial operation in Assam on or after but prior to and they are exempted from the liability to payment of entertainment tax. Therefore it is WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 13 of 15

14 natural to infer from the words used that, exemption is intended for the exhibitors. According to our perception, contrary conclusion will be illogical when the literal Rules of interpretation is to be applied. 40. The concept of cineplex is new in Assam and the state has obviously tried to encourage establishment of cineplexes through incentives by way of exemption from the liability to pay entertainment tax. The mere fact that incidence of tax is on the cine-goers, the exemption notification in the face of clear words can t be understood to target those, who pay to be admitted for entertainment. 41. Next we have to deal with the submission of the learned Addl. Advocate General that the exemption notification shouldn t be construed in favour of the petitioners since mode and manner of disbursal of incentives is not prescribed here unlike in the Govt. notification dated issued under the State s Industrial Policy. The context in which tax incentive was granted by the Govt. notification dated are clearly distinguishable from the present situation. In our perception, elaborate mechanism is unnecessary here since the exhibitors are simply made free of their obligation to pay to the State, the collected tax. Therefore the argument on this issue do not aid the respondents. 42. The Madras High Court in P. Sankara Narayanan (supra) while examining a challenge to levy of higher tax for dubbed films had described that exhibitors is simply a collection agent since the burden of taxation is ultimately passed on the cine-goers. But in the face of the exhibitor s obligation under Section 3(6) of the Assam Act, the primary liability to pay the entertainment tax under the enactment we are considering, is on the exhibitors and therefore the passing observation of the learned Judge of the Madras High Court in the context of the Tamil Nadu case, can have no bearing on our decision, in the present matters. 43. Now we have to analyse whether the decision in Swanstone Multiplex (Supra) can be applied here to deny the benefit of the exemption notification to the exhibitors on the principle of unjust enrichment. As earlier noted, the charging of tax is not exempted but liability from payment of tax is exempted, under the Notification dated issued under sub-section (2) of Section 8. But on the other hand, the charging of tax exempted, when a notification is issued under sub-section (1). When the tax liability is imposed on the cineplex WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 14 of 15

15 owners under Section 3(6) of the Assam Act, the exemption notification under Section 8(2) has to be construed in our view as one, intended to provide incentives to new multiplexes established during the specified period. Therefore when charge of tax has not been exempted (since Section 8(1) notification is not issued here), the collection of tax can t be described as illegal collection. Thus retention of the collected tax (when levy is not exempted), do not amount to unjust enrichment for the exhibitors. Therefore we hold that the decision in Swanstone Multiplex (Supra) can t be applied to deny the benefit to the petitioners in the present cases. 44. Consequently the tax recovered by the exhibitors, as admitted by the 2 nd group of litigants, in our view is not collected illegally and therefore we declare that they have no obligation under Section 172 of the Contract Act, to refund any entertainment tax for the exempted period. 45. As earlier noted the charge and levy of tax was never exempted and therefore the cine-goers were not provided any relief under the exemption notification. On the other hand, the exhibitor was freed of their obligation from the liability to the entertainment tax, through the notification issued under Section 8(2) of the Assam Act. Therefore we have no hesitation to hold that incentive was intended for the investors on cineplexes and consequently for the relevant period, the exhibitors can t be forced to discharge their obligation under Section 3(6) of the Assam Act. Since in the present case, entertainment tax has been levied only on the ground that in spite of the exemption having been granted by the notification dated , petitioners allegedly collected entertainment tax, the impugned orders of assessment are declared to be illegal, without jurisdiction and therefore the same are set aside and quashed. 46. Following the above discussion and our conclusion in favour of the exhibitors on all the issues as delineated above, we declare that the demand of entertainment tax from the exhibitors for the period specified in the notification dated (Annexure-I) is illegal and therefore the assessment to tax under the Assam Act for the petitioners are quashed. The cases are allowed with this declaration. No cost. Barman/Roy/Datta JUDGE JUDGE WP(C) 4477, 4480, 3439, 3443, 3444, 3445 & 4479/2014 Page 15 of 15