M/s. Naulakha Theatre vs. State of , [2013] 64 VST 481 (P & H)

Facts
The petitioners, owners of cinema theatre, made various representations to the Government for concession in payment of entertainment tax. In response, the Government took a decision to give 33% concession in the entertainment tax, if the tax is deposited in lump sum. Such decision was taken by the cabinet and was incorporated in the annual budget for the year 2003-04 presented before the Legislative Assembly on March 24, 2003. The petitioners have allegedly deposited the lump sum entertainment tax in pursuance of such budget proposal. It was later somewhere in September, 2004, the demand was raised against the petitioners on the ground that the petitioners have deposited entertainment tax availing of rebate of 33%, whereas no notification has been issued by the Punjab Government. The Petitioners filed writ petition, before the Punjab High court against such demand.

Held
The issue, whether entertainment tax can be permitted to be paid in lump sum or not, is a matter of policy. Such policy could be given effect to only by amending the Punjab Entertainment Tax (Cinematograph Shows) Rules, 1954. Neither the budget proposal nor the earlier statement of Chief Minister is to the effect that it has been decided to permit the payment of entertainment tax in lump sum. The representation is only that the State Government has proposed the payment of entertainment tax in lump sum so as to grant concession up to 33%. No promissory estoppel can be raised against the State on the basis of such promise, when the levy of entertainment tax is statutory.

One of the essential ingredients so as to invoke the doctrine of promissory estoppel is altering of position by a person. However, the averments do not show that the petitioners have altered their position on the basis of representation of the functionaries of the State. The petitioners were running cinemas and continued to run cinema even after the speech of the Chief Minister/ Finance Minister. If the petitioners have provided better facilities and infrastructure though in the absence of any material, such fact cannot be taken into consideration; still such better facilities do not lead to alteration of positions by the petitioners on the strength of promise made. It is the convenience of the visitors, which was taken care of by the cinema owners, when they provided better facilities and infrastructures or when they screen big budget films, which will obviously gave better revenue to the petitioners as well. Therefore, it cannot be said that the petitioners have altered their position to their detriment on the basis of speech of the Finance Minister proposing the reduction of the entertainment tax. Accordingly, the High Court dismissed the writ petition filed by the petitioners.