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Court orders DTH operators to pay Ent. Tax of almost Rs.20 Crores to Gujarat Govt

Indian direct to home (DTH) satellite TV operators have been ordered to pay within two weeks the entertainment tax due to the government of Gujarat by an Ahmedabad court.

The division bench of acting chief justice Bhaskar Bhattacharya and justice J B Pardiwala said Tata Sky, Bharati Telemedia,Dish TV India, and Bharat Business Channel must deposit almost INR 20 crore in taxes accrued since September 2010.

The DTH operators have moved the high court following the imposition of entertainment tax by the Gujurat Government in 2009. They had felt the stategovernment
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A division bench of acting chief justice Bhaskar Bhattacharya and justice JB Pardiwala on Friday directed DTH (direct to home) operators to pay entertainment tax due to government of Gujarat within a fortnight. The order came after the DTH companies failed to comply with an interim order regarding the same.

Following the order, TataSky Limited, Bharati Telemedia Ltd, Dish TV India Limited, and Bharat Business Channel will have to deposit close to Rs20 crore as entertainment tax. The tax had been due since September 2010. The DTH operators had moved the high court after the Gujarat government had imposed entertainment tax on them in 2009 following amendment to the Entertainment Tax Act.

Moving the HC, the operators had termed the government's decision as illegal and contrary to law. The government through the amendment was to charge Rs200 per DTH connection. The operators had argued that they were into providing service and not entertainment and thus cannot be brought under purview of entertainment tax. The court had in an interim order asked the companies to pay entertainment tax due to the government while the matter was being decided.

The court had stated that if the final decision came in favour of the operators, the tax paid can be refunded to them. The companies had, however, failed to comply with the order.

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