Entertainment Tax on Cinema Tickets: Telangana HC directs State to form Committee to Study Issues of Exhibitors and Distributors [Read Order]

The Single bench of Hyderabad High court has recently directed the state to form a committee to study the issues of exhibitors and directors in the field of entertainment tax on cinema tickets .

The writ petition was filed by the theater owners of the Andhra Pradesh state challenging the order passed by the government in G.O.Ms.No.181, dated 11.7.2011.

The court struck down the order and ordered the state government to constitute a committee for suggesting the factors to be considered while fixing or increasing the rates of tickets in various classes of Cinema Theatre.

After the recommendation of the committee, the Government issued an order that rates of highest ticket price at Rs.75/- in Municipal Corporation and the rates for the lowest class at Rs.20/.

The petitioner opposed the recommendation and say that it was unfair that air conditioned cinema theaters are permitted to collect only Rs.10/- to the lowest class, and where non-air conditioned cinema theaters are being encouraged to collect Rs.10/- for the lowest class it was unfair .Further the petitioner object that the notification made by the government on fixing minimum ticket price is contrary to provisions of A.P. Cinemas (Regulation) Act, 1955 and A.P. Cinemas (Regulation) Rules, 1971.Against the order petitioner filed the writ petition.

Deputy Secretary to Government, Home Department, Andhra Pradesh submits that,

“The recommendations of the said committee are advisory only but not absolute also respondent after considering the larger interest of the society has fixed rates to the lowest class. Moreover Government also classified areas (cities, towns etc.,) into five grades for the purpose of fixing the rates of tickets of the cinema theaters in different classes”

H. Venu Gopal counsel for the petitioner argued that,

“The rates fixed by the Government by the impugned Government Order to the areas like Corporation, Municipalities and Gram Panchayats are discriminative in nature since the expenditure in all the theaters in Corporations, Municipalities and Gram Panchayats is one and the same. The rates fixed by the Government in the areas classified in the G.O. cause hindrance and loss to the exhibitors.”

The single bench of Justice Raja Elango observed that the Government order passed by the Andhra Pradesh government prior to the bifurcation, in the year 2013.

The Counsel for all the petitioners, Sri H. Venu Gopal, Government Pleader for Home for Telangana State and the Government Pleader for Home in the State of Andhra Pradesh fairly conceded that in view of the changed circumstances, the GO impugned cannot be made operative. In this regard, they sought certain directions from this Court.

The bench further set-aside the order passed by the Andhra Pradesh Government before bifurcation and ordered the both state governments to constitute committee Study Issues of Exhibitors and Distributors.

To Read the full text of the Order CLICK HERE

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