The Delhi high court on Thursday asked for the AAP government’s response on DDCA’s plea challenging the latest changes in Delhi’s entertainment tax laws providing for levying tax on sponsorship and advertisement revenue retrospectively from 1998.
The court issued the notice to the Delhi government seeking its reply on a plea by the Delhi and Di-strict Cricket Association which has sought quashing of the amendments to the Delhi Entertainment and Betting Act that seek to levy tax on sponsorship and advertisement revenue from 1998.
Senior advocate Sandeep Sethi and advocate Sangram Patnaik, representing the DDCA, contended that retrospective imposition of tax was “unconstitutional and unreasonable”. The counsels said that the DDCA has already paid over '8 crore from 2009 onwards as entertainment tax and from 2000 to 2008, it was exempted from the act.
The recent demand of over Rs 23 crore as entertainment tax by the Delhi government was on the advertisement and sponsorship revenue earned during the period from 2003-2009 during which these were not chargeable, the plea said.
The amendments of this year created an “absurd situation” where the DDCA, which only collects the tax from persons making the payment, will now have to claim entertainment tax from the sponsors/advertisers for the period of 2003-2009, said Mr Patanaik.
The DDCA has also sought to set aside the Delhi government’s asse-ssment order of October 23 as per which it has to pay entertainment tax of over Rs 23 crore.
