The PVR group has moved the Allahabad High Court, and its Lucknow bench, over the issue of subsuming entertainment tax into the goods and services tax (GST).
The HC has sent a notice to the state government, asking it to explain its scheme of entertainment tax.
The PVR group has said that the Uttar Pradesh government promised to allow multiplexes and cine malls retain a portion of entertainment tax for five years, on the basis of investments they make, but that was broken after the tax was subsumed into GST.
“We have challenged the subsuming of entertainment tax into GST to the extent that the corresponding benefit of retention of tax is not granted in the GST regime,” Abhishek Rastogi, the counsel of PVR group, told Business Standard.
The firm has challenged the new tax on the principle of promissory estoppels, which is a legal principle that says a promise is enforceable by law even if made without formal consideration.