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Bombay HC backs Maharashtra’s tax on online movie ticket booking fees
Bombay High Court upheld Maharashtra’s tax on online movie ticket booking fees over Rs 10, ruling it part of “payment for admission” under entertainment duty, rejecting claims of legislative overreach and distinction from offline sales.
The petitioners had argued that online booking was a separate service and could not be taxed under Entry 62 of List II of the Constitution, which empowers states to impose taxes on entertainment.
The Bombay High Court has upheld the Maharashtra government’s decision to levy entertainment duty on the additional fees charged for online movie ticket bookings, equating the process with traditional box-office purchases, as per a report by Bar and Bench.
A division bench of Justice M.S. Sonak and Justice Jitendra Jain dismissed multiple petitions challenging the constitutional validity of the seventh proviso inserted into Section 2(b) of the Maharashtra Entertainments Duty Act (MED).
The amendment brings convenience charges, when exceeding Rs 10 per ticket, within the ambit of “payment for admission,” thereby attracting entertainment duty.
The petitioners had argued that online booking was a separate service and could not be taxed under Entry 62 of List II of the Constitution, which empowers states to impose taxes on entertainment. They also alleged “colourable legislation,” claiming the amendment was a backdoor attempt to curb excessive convenience fees charged by cinemas.
The court, however, rejected these arguments, stressing that the legislature was within its rights to determine the measure of tax. It held that the convenience fee is “directly connected with buying a ticket for entertainment,” and that drawing a distinction between booking methods was unnecessary.
“The distinction sought to be made within the entertainment area and outside the entertainment area is superfluous,” the bench noted, adding that without the proviso, all such charges would automatically fall under the tax measure in Section 2(b)(iv).
Observing that the power to tax entertainment under Entry 62 includes matters “incidental thereto,” the court ruled that the online booking fee is part of the admission process. It further clarified that the Statement of Objects and Reasons—stating an intent to curb excessive fees—did not undermine the validity of the amendment.
With this decision, cinema owners in Maharashtra will have to continue paying entertainment duty on online booking charges exceeding Rs 10 per ticket, just as they would on traditional ticket sales.
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