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Kerala High Court orders setting aside the levy of Luxury Tax on DTH

12-December-2015
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Kerala High Court orders setting aside the levy of Luxury Tax on DTH

The judgement of Hon’ble High Court of Kerala about setting aside the levy of Luxury Tax on DTH has been welcomed by DTH operators. 

Commenting on the order,  Rajeev Dalmia, Chief Financial Officer, DishTV said, “We welcome the Hon’ble Kerala High Court’s order to set aside the levy of Luxury Tax on DTH. While setting aside the levy, the Hon’ble High Court of Kerala has further directed that luxury tax, if any, paid by the petitioners during the period from 1/4/2011 shall be refunded to them.”  

It is noteworthy that DTH is the only industry which is subject to both Entertainment Tax (at state level) and Service Tax (at central level). In addition DTH operations in India are also levied 10% License fees by the MIB, though in year 2008 MIB had decided to levy 6% of AGR, the effect of which has been denied since 7/8 years to the DTH operators.  

Levy of Luxury Tax or the like would have been a dampener for the DTH industry, which after a long and continuous investment cycle has just turned the corner in terms of operational profitability. 

With the Hon’ble Kerala High Court judgement setting the trend, the tax regime for the DTH industry should hopefully be rational going forward.

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