The constitutionality of country laws permitting the imposition of advertisement tax in Karnataka by means of municipal and employer authorities has been challenged within the Karnataka High Court.
On Friday, Justice S Sunil Dutt Yadav surpassed an interim order in the depend restraining the nation from taking any coercive movement for non-payment of commercial tax until June, while it will soak up the matter subsequent. The order applies to all needs made for such tax after the commencement of the 101st modification to the Constitution of India.
The writ petition filed by using Outdoor Advertising Association via Advocates Arjun Rao and Maitreyi Bhat highlights that following the one hundred and first Constitutional Amendment, kingdom government does not have the energy to legislate in the discipline of taxes for classified ads.
Prior to this amendment, the state government had derived the electricity to impose such tax from Entry fifty-five, List II of the VII Schedule of the Constitution. However, following the amendment, this entry has been deleted.
Moreover, it’s far talked about that during 2017, commercial tax becomes subsumed into the Goods and Services Tax because of the enactment of the Central Goods and Services Tax Act, 2017 and the Karnataka Goods and Services Tax, 2017.
Nevertheless, the petitioner highlights that country authorities have repeatedly coerced the fee of commercial tax below provisions of the Karnataka Municipal Corporations Act, 1976 and Karnataka Municipalities Act, 1964. Provisions allowing the same beneath each legal guidelines are but to be repealed. As noted in the petition,
“The stated [state] government are … stressful price of commercial tax on the threat of elimination of classified ads and hoardings, non-renewal of permissions, and many others. While the out of doors media proprietors have answered to these notices mentioning that after the introduction of GST, commercial tax is now not leviable by way of the said authorities, they recognize that their hoardings will be removed for non-charge of the wrongly-demanded commercial tax…
… the Petitioner and its contributors preserve to face coercive action on the arms of the stated government ostensibly in terms of provisions that are ex facie unconstitutional.
Outdoor advertisers have been pressured to make the fee of GST, as well as advertisement tax to the said authorities under protest and various hoardings was removed for non-fee of advertisement tax to the stated authorities. The monetary effect arising from the unlawful tax demands at the advertisers has been significant and the removal of hoardings has had incalculable monetary results.”
In this backdrop, the petitioner has contended that Article 19 (1) (g) of the Constitution has been violated.
The petitioner goes directly to factor out that following the 101st Constitutional change, Karnataka’s Panchayat laws were duly amended to delete provisions concerning the imposition of commercial tax. In impact, this tax is being imposed simplest in regions other than Panchayat regions in Karnataka. It is contended that this constitutes an Article 14 violation.
Before the High Court, the country contended that despite the fact that the word “tax” has been used inside the country acts, the quantity accumulated is inside the nature of a license fee.
All the same, the Court opined that the matter required similarly consideration. Therefore, it issued a meantime order restraining the kingdom from taking any coercive motion with recognize to demands for a charge of advertisement tax until the following date of hearing.
The predominant prayers made by means of the petitioner before the High Court are as follows:
That provisions allowing the imposition of advertisement tax by country government notwithstanding the 101st Constitutional modification is struck down. In this regard Sections 103 (b)(iv), 134, 135, 139 and Schedule VIII of the Karnataka Municipal Corporations Act, 1976 and Sections 94 (I)(b)(xiii), 133, 142, 324 and Schedule VII of the Karnataka Municipalities Act, 1964 have been pinpointed.
That the High Court difficulty an assertion that bodies under the Karnataka municipal and business enterprise government and different national authorities don’t have any authority to gather advertisement tax;
That the High Court direct the refund of all amounts collected via the government as commercial tax following the commencement of the hundred and first Constitutional change.

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