Kerala act 032 of 1976 : The Kerala Tax on Luxuries in Hotels and Lodging Houses Act,1976 (No.32 of 1976)

:p' \

I

Sec tsons

161

THE KERALA TAX ON

LUXURIES IN HOTELS

AND

Preamble. wmQGwFFWKOP—l b—Ar—JH

rep-c

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14

15

16

17

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22

LODGING HOUSES

ACT,

1976

(Act ^32of

1976)

CONTENTS

Short

tltle,

extent and

commencement Defimtxons Authorlues Levy ^andcollectlon^of

luxuly ^tax Returns Assessment

and collectlon

of tax Appeal

REVISIOH

Court ^fees Recovery ^of

unpald

luxury ^tax Scrv1ce of nouce Power to

Inspect

and 1am:

comes of IeCUl'dS and accounts

Power to order

productlon

of accounts and powers, of

entry,

mspecuun, ^etc Fewer to take evxdence on

oath,

etc Refunds lextatlon oi

clalms

for

reiund Penaltles Offences

by compames Bar of

Junsdlctlon Power to make

rules Power to remove d1f'ficult1es Repeal ^andsang.

162

THE KERALA TAX

ON LUXURIES IN

HOTELS

AND

LODGING HOUSES

ACT,

1976' (Act ^32of

1976)

An Act to

provrde

for

the

levy

and

collection

of

a

tax

on luxuries

provided

in

hotels

and

lodging

houses Preamble—WHEREAS 1t lS

expedlent

to

pr0v1de

for ^the levy ^and

collectlon ^ofataxon1uxur1es

prov1ded ¹ⁿhotels ^and lodgmg

houses, BE 1t enacted 1n the

Twenty-seventh

Year of the

Repub'nc of

Indla as follows ^—

1

Short

title,

extent and

commencement.-—(1)

ThIS Act may ^be

called the Kerala Tax^onLuxurles ¹ⁿ

Hotels

and Lodgmg

Houses ^{Act, 1976}

(2) ^It

extends ^{to the}whole ^oftheState^ofKerala

(3) ^Itshall ^be

deemed ^{to have come1nto}

force ^onthe lst

day ⁰¹

July, ¹⁹⁷⁶

2

Definitions—In thls

Act,

unleSs

the context

otherwrse requ1res,— (a)

"appellate authorlty"

means ^an

appellate

authority appomted

under sub—sectlon ^{(2) of}sectlon ^3,

(b) "assessmg authority"

means^an

assessmg authonty appomted

under sub-sect1on

(l) ^ofsectlon ^3, (c)

"Board^ofRevenue" means^the

Board^of

Revenue const1tuted

under^the

Kerala Board of Revenue

Act. 1957, (cl)

"company"

means^a

company ^asdefined¹ⁿscctlon^d of the

Compames

Act, 1956, (e)

"hotel" means ^a

bulldmg ^{or part ofa}

buzldmg

where resrdential accommodatlon 15

by way of

business

provided

[or a

monetary

con51derat10n and

mcludes a

lodgmg

house *

Renewed

the assent of the

Governor

on

the 11th

day

of

November.

1976 and

pubhshed

1n the

Kemla Gazette

Extrumdmary ^No

647.

dated ^13th

November, ¹⁹⁷⁶

.a

Id.

163

Explanation ^—A

guest

house^run

by ^theG0vernment ^or a

company ^or

a

corporation

established

by

or

under any law or

any other agency shall

be deemed

to be a hotel within the meaning ^{of this}

clause, (f)

"luxury prov1ded ^inahotel" means accommodation for

reSidence^andother

amenities^andserVices

prOVided ^ina hotel, ^{therate of}

charges ^forwhich

(exclusive ^of

charges ^for food,

drink^and

telephone calls) ^isfifteen rupees^per

day ^Oi more,

(g) "prescribed"

means

prescribed by

rules^made{inder this

Act, (h)

"proprietor", ⁱⁿ

relation^toa

hotel,

includes ^the person who for the

time

being ^{is in}

charge

of

the manage- ment of the hotel

3

Authorities—(1)

The Government may, by

notification in

the

Gazette, appomt

such officers as

they

think

fit to be assessmg authorities

for the purposes of

this Act and may assigi. to them such local

limits as the

Government may think fit

(2) ^TheGovernment may, by

notification ^inthe

Gazette, appoint ^suchofficers ^as

they

think^fittobe

appellate

authorities for the purposes ^ofthis

Act and may aSSign

to^them

such

local limits as^theGovernment may think fit

(3) ^All

authorities^andofficers

employed ^{in the}execution of this Act shall

observe^andfollow

the

orders,

instructions and directions of the Board ^ofRevenue Prov1ded ^{that no such}

orders,

instructions ^or

directions shall ^be

given ^{so asto}

interfere ^withthediscretion^ofthe appellate

authority ^{in the}exercise ^ofits

appellate functions,

4

Levy

and collection

of

luxury tax.—(l)

Subject

to

the prOVismns of this

Act,

there shall

be

leVied and

collected^atax in

respect

of any luxury provided

in^ahotel

(hereinafter

called the

"luxury

tax").

164

(2) ^The

luxury ^taxshall^be

payable by ^theperson reSiding ^{in a}

hotel, ^atthe

followmg rates,

namely ^'— (a)

Where^therateof

charges ^foracco-^Five

per

centum^of mmodation ^forresidence

and such

rate other

amenities and

services (exclusive ^of

charges ^for

food, drink and

telephone calls)

is fifteen rupees

or more

but does not

exceed

twenty-five rupees per

day per person (b)

Where^suchrateexceeds

twenty-

Seven ^{and a half}per five rupees but

does not

exceed

centum of such rate fifty rupees per day per

person (c)

Where^suchrateexceeds

fifty rupees^Tenpci

ccntum^of per day per person such rate:

Prov1ded

that

where such

charges

me

leVied otherwise than on

daily

basis or

per

person, then,

the

charges

for deter— mining ^the

liability ^totaxunder^thissection shall^be

computed as for a

day

and per person based ^onthe

period

of

occupation of the

resrdence

for

which the

charges

are

made and the number of persons actually

occupying ^or

permitted ^to

occupy according ^{to the}

rules^orcustom^ofthehotel

(3) ^The

luxury ^taxshall^be

collected

by ^the

proprietor and

paid

Within

such

period

andⁱⁿsuch manner^as

may be prescribed, ^intoaGovernment

treasury

(4) ^In

computing ^the

luxury ^{tax, a}

fraction ^{of a}

rupee which ^isnota

multiple ^of

five paise shall ^be

rounded off^tothe next

higher

multiple

of five

paise

5 Returns

—(1)

Every proprietor

liable to

pay luxury tax

under this

Act shall submit ^areturnⁱⁿ

the

prescribed

form to

the

assessing authority

Within

eight days

after the

end of the month to which ^thereturn relates

(2)

Every ^such

return shall^showthenumber^ofrooms or other accommodation ⁱⁿ

the hotel which is

intended to be occupied, ^thenumber ^ofpersons^who

occupied ^suchrooms ^or accommodation, ^the

periods ^oftheir

stay, ^the

days ^of

arrival and

departure,

the

amount of

charges

recovered

from

them for accommodation

and other

amenities ^andserVices, together With such

other

information ^as

may ^be

prescribed.

'd

165

(3)

Every ^suchreturn

shall ^be

accompanied by ^a

receipt for

payment

on

Government account into

a

Government treasury ^ofthefullamount^{of the}

luxury ^{taxfor the}

period ^to which the return

relates

(4)

Every

return

shall ^be

verified^inthe

prescribed manner

6 Assessment and

collection

of

tax.—-(l)

On

receipt

of a return

under section

5,

the

assessing' authority

shall assess the

luxury

tax

payable

in

respect

of the

period

to

which the return

relates,

and if the amount

has

not

already

been

paid as

aforesaid,

it shall cause a notice to

be served

upon

the proprietor

concerned

requiring^himto

pay^the

amount assessed within ten

days

of

the serVice

of

the notice

(2) ^Ifthe

proprietor

fails^tosubmit^{indue timethe} return referred to ⁱⁿ

section

5,

the

assessing

authority shall, after

giving

him ^a

reasonable

opportunity

of

being heard,

assess to the

best

of

its

judgment,

the amount of

luxury

tax

payable and the prOViSions of sub-section

(1) ⁱⁿ

respect

of notice shall apply ^asifsuchassessment^{hasbeenmadeonthe}basis^ofa return

furnished

by

such

proprietor

(3) ^Ifthe

luxury ^{tax18not paid}

Within ^the

prescribed period ^theassessing authority may levy ^a

penalty

equal ^toa sum not

exceeding

the amount of

the

luxury

tax

payable

under this ^Act Provided ^thatno

penalty

shall^belevied under^thissub- section unless

the

proprietor

has been given ^a

reasonable opportunity ^of

being

heard

7

Appeal -—Any person aggrieved by ^an

order of assess— ment made ^ora

penalty

lev1ed under

section 6 may,

Within

thirty days ^{from the dateof}

receipt ^{of the}

order,

apply ^tothe

appellate authority ^fortheannulment ^or

modification ^of

the

assessment or

penalty,

and ^on

such

application.

the

appellate

authority may, subiect ^tosuch

rules of

precedure ^{as may}be

prescribed, confirm,

annul^or

modify ^theassessment^or

penalty

8

RevisiOn.—-(1)

The Board of

Revenue may,

either ^suo motu or ^on

application,

call

for and

examine the record and proceedings ^ofanyorder^made

by ^the

assessing authority ^and pass such order

thereon^asitthanks

just ^andproper.

166

Provided ^thatno

application

under^thissub-section shall be entertained if it is not made

within

a

period

of

ninety days from the date on which

the order in

question

was received by ^the

applicant. Provided

further

that

before

rejecting any application under this

sub—section,

the

Board

of Revenue shall record reasons for

such

I'EIGCllOn

(2) ^No

order shall^be

passed

under sub-section ⁽¹⁾ which is

likely

to

affect any

person adversely,

unless such person has been

given ^areasonable

opportunity

of

being

heard

(3)

Where^a

person could^have

appealed

under section⁷ and ^no

appeal

has been filed

by

him, ^no

proceedings

under^this section shall be entertained upon ^the

appliCation

of such person

9. Court

fees.-—-Notw1thstanding anything

contained

in

the Kerala

Court

Fees^and

Suits Valuation

Act,

1959

(10 ^of

1960}, an

appeal preferred

under section

7 or an

application

for revi- Sion made under section 8 shall bear a court fee

stamp

of

such value ^as

may^be

prescribed

10.

Recovery

of

unpaid luxury

tax—Any luxury

tax or penalty

recoverable under ^{this Actand}remaining unpaid may be recovered ^asanarrear^of

public

revenue due ^onland

11 Service of notice—A notice

under the

prov1s10ns of this Act may be served

by

post

or

by delivering

or

tendering it ^totheperson ^{towhomit is}addressed^{orto his}

agent ^orin such other manner as

may be

prescribed

12 Power ^to

inspect

and take

copies

of

records and accounts.—-(1) ^Theassessmg authority

shall^haveaccess^at all reasonable times

to :1 hotel or

place

of

busmess of any person liable^to

collect ^or

pay^the

luxury ^tax

under^thisAct

(2) ^The

assessing

authority may, ^at

any time, ^{with or} without

notice to

any

perSOn referred

to

in

sub-section

(I),

examine his

working

records and accounts and take copies of, or

extracts

from, any of the said

records

or

accounts for pur- poses ^of

testing ^the

accuracy ^ofany return^orfor

informing itself ^asto

the

particulars regarding

which

information

is required ^{for the}purposes^{ofthis Act or}

any ^{rule made}

there- under, Au.-

4.

A...

~_, -.._-_._, __

_

'd

167

13. Power^toorder

production

of accounts and powers of entry, inspection, etc.—(1) ^The

assessing authority may,^for the purposes ^{of this}

Act,

by

notice, require

any proprietor—

(a) ^to

produce ^orcause^tobe

produced

before ^itany accounts,

registers,

records^or

other

documents; ^or

(b) ^tofurnish ^orcause^tobe

fumished any \other information

relating

to

the

hotel, and such

proprietor

shall

comply

With such

requisition.

(2) ^The

assessing

authority may, ^at

any reasonable time,—— ^.

(a)

enter

any

hotel^or

place ^ofbusmess ^or

any

vehicle or

vessel of the

proprietor,

and

(b) inspect any accounts, registers,

records ^orother documents

relating

to his hotel or

hotels

(3) ^Iftheassessmg

authority ^hasreasons^tobelieve that a

proprietor

is

trying

to evade

the

collection ^or

payment of the

luxury

tax,

it

may, for reasons to

be

recorded,

enter and search—

(a) any hotel^or

place ^ofbusiness^ofthe

proprietor; ^or

(b) any other

place

where ^the

proprietor ^is

keeping or

is

reasonably

believed to

be

keeping

any accounts,

registers, records ^orother documents

relating ^tohis hotel ^or

hotels Provided

that

no residential accommodation

(not

being a

hotel-cum-resrdence)

shall be entered mto

or

searched,

unless the

assessing

authority

15

specially

authorised ⁱⁿ

writing

by ^the Board ^ofRevenue^tosearch^thataccommodation Explanation

—-For^the

purposes ^of

clause

(b),

'place' includes any godown, building, vessel, vehicle, ^{box or}

receptacle.

(4) ^Allsearches under ^thissection

shall, ^{sofaras may} be, ^bemadeinaccordance^{with the}

prowsions ^{oftheCode of} Criminal

Procedure, ¹⁹⁷³

(Central ^{Act 2of}

1974)

(5) ^The

assessing

authority

making ^the

inspection ^or search may seize^such

accounts,

registers,

records ^orother documents ^asit

considers necessary, and^onsuch

seizure shall grant ^the

proprietor ^a

receipt ^ofthe

things

seized.

3/9742

168

(6) ^The

accounts, registers,

records^orother documents seized under sub-section

(5)

shall not be

retained

by

the assess— ing

authority

beyond ^a

period ^of

thirty days ^fromthedate of seizure

except

with the

permission

of such

authority

as

may be

specified by

the

Government

in this

behalf,

unless

they

are required ^forany prosecution

under^thisAct '

Provided that the

authority spec1fied by

the

Government under this sub-section shall

not

give permission

to retain

such accounts,

registers,

records^orother documents

beyond ^a

period of

forty-five days

from the date of the seizure

(7) ^Thepower conferred

by

sub-sections

(3) ^and

(5)

shall include—

(a) ^thepower^tobreak open

any^boxor

receptacle ^or place ^{orthe door of}any premises ⁱⁿ

which any accounts, registers,

records^or

other

documents^{of the}

proprietor ^are reasonable believed to be

kept:

Provided ^{that the}power ^tobreak open^{thedoor of}any premises

shall^beexercised

only

after ^theowner^or

any other person in

occupation

of

the

premises

fails ^or

refuses to open the door ^on

being

called upon^to

do so;

(b) ^thepower^tosealany^boxor

receptacle,

godown or

building,

where any accounts,

registers,

records

or other documents ^areorare

reasonably

believed to be

kept,

if the owner or

any other person in

occupation

leaves

the

premises or

refuses

to open the

box or

receptacle,

godown

or

building, or

is not

available,

and

then

to break open

such

box,

receptacle, godown ^or

building, ^{on the}

authority ^ofan

authorisation ⁱⁿ writing by ^theBoard^of

Revenue,

(c) ^thepower ^to

search any

person^whohas

got ^out

of, or

is about to

get into,

or

is

in. any place

referred to in

clause

(a) or

clause

(b)

of sub—section

(3) ^or

any vessel or vehicle of any proprietor, ^ifthe

assessing

authority ^hasreasons^to

suspect that such person has secreted

about his person any accounts, registers,

records^orother documents

14 Power ^to

take

evidence on

oath,

etc.—The

assessing authority, ^the

appellate authority ^{and the}Board^ofRevenue shall, ^{for the}purposes^ofthis

Act, ^havethesame

powers ^as at

'

169

are vested

in a

civil court under the Code

of

Civil

Procedure,

1908

(Central

Act

5 of

1908),

when

trying

a

suit,

in

respect of the

following matters,

namely:—

(a) enforcing ^theattendance^ofany

person^and examining ^{him on oath or}

affirmation,

(b) requiring ^the

discovery ^and

production ^ofdocu- ments;

(c) receiving

evidence^on

affidaVIt;

(d) issuing

commissions^forthe

examination ^of witnesses,

15.

Refunds—(1)

If any

proprietor

satisfies the

assessing authority ^{that the}amount^{of the}

luxury ^tax

paid by ^him exceeds ^theamount^of

such tax

payable by

him under this Act, ^he

shall^be

entitled^toarefund ^ofsuchexcess

(2) ^The

appellate authority ^{in the}exercise^ofits

appel- late pOWers

or

the Board

of

Revenue in

the exermse of its revisional powers, it

satisfied ^to

the like

effect,

shall cause

a refund to be made

by

the

assessing

authority

of any amount found to have ^been

wrongly

paid ^or

paid ⁱⁿexcess.

16. Limitation

of

claims

{01-

refund.—No claim to

any refund of the

luxury

tax under section 15 shall^be

admitted, unless ^it

is

made within

three

years^fromthe

date of ^theorder of assessment or, where an

appeal

has

been

preferred ^or

where there has been

a

reVision,

within three years from the date of the order ⁱⁿ

appeal ^or

revision, ^asthe^case

may be.

17.

Penalties—(1) Any person

who—

(a) knowingly

submits^anuntrue' return ^or

fails ^to submit a

return

as

required by ^{this Actorthe}

rules made

there- under; ^or

(b) wilfully ^actsincontravention ^{of any ofthepro-} visions of this Act^orthe rules made

thereunder for the contra- vention of which ^no

express provision

for

punishment ^is

made by ^this

Act, shall ^be

punishable ^with

fine which may extend ^toone

thousand rupees 3/97—l2a.

170

(2)

Any

person^who—

(a) prevents ^orobstructs

inspection, entry,

search ^or seizure

by ^the

assessing

authority, ^or (b)

fraudulently

evades^the

payment ^of

luxury ^{tax or} other amount due from

him under

this

Act, shall be

punishable

with

imprisonment

for

a

term

which may extend to Six

months, ^or

wrth fine which may extend to one thousand rupees, ^orwith

both

(3) ^A

person shall^{not be}

proceeded against

under^this section

except ^attheinstance^ofthe

assessing

authority

18 Offences

by companies.—(1)

Where an offence under this Act has been

committed

by

a

company, every person who at the time the offence was committed was in

charge of,

and' was

responsible

to, the company for the

conduct

of the

business of the company.

as well as the company, shall be deemed

to be

guilty

of

the offence and

shall be liable to be

proceeded against ^and

punished accordingly:

Provided

that

nothing

contained in this sub-section

shall render any such person liable to

any punishment,

if he proves that

the offence

was

committed

without his

knowledge ^or

that he

had exercised all due

diligence

to

prevent

the

commission of

such offence

(2) Notwithstanding

anything

contained ⁱⁿ

sub-section

(1),

where any

offence under ^{thisActhas been}

committed

by ^a company and^itis

proved

that the

offence has

been committed with the consent ^or

connivance

of, ^or

is attributable to

any neglect ^{onthe partof,any}director, manager,

secretary ^or other officer of the company,^such

director,

manager,

secretary, or

other officer shall be deemed

to

be

guilty

of that offence and

shall

be liable ^tobe

proceeded

against

and

punished

accord- ingly ^v

"

Explanation—For ^thepurposes^ofthis

section,—

(a) "company"

means

any

body

corporate ^and

includes a firm^orother

association of

individuals. and (b)

"director", ⁱⁿ

relation^{to a}

firm,

means^a

partner in the

firm. .4?

'wv'

171

19 Bar

of

Jurisdiction

—-No

su1t

Shall

11e 111

any C1v11

court to set a51de or

modify any

assessment made under

this

Act and ^no

prosecutmn,

suit^orother

legal proceeding

shall

he against ^the

Government^or

any authority ^or

officer^forany— thing ¹ⁿ

good

faith ^doneorintended ^{tobe done}under ^{th1s Act.}

20 Power ^to

make

rules. —(1)

The Government may, by notification in^the

Gazette,

make rules for

carrymg

into effect the prov1510ns of

this

Act

(2) ^In

particular. ^andw1thout

preJudlce ^tothe

generality of the

foregomg power, such rules may prov1de

for all^or

any of the

followmg matters, namely ^—-

(a) ^{the form 1n}which returns shall^be

submitted

under section

5,

further

information ^to

be

furmshed with

the returns and ^the

manner ¹ⁿ

which ^thereturns

shall ^be

verified,

(b) ^theformofnotice ^{.to be}served under section⁶ and the

procedure ^tobefollowed^forassessment^and

collect1on of

the

assessed

dues,

(c) ^the

procedure ^tobe

followed

by ^the

appellate authorities ,

(d) ^the

value^ofcourt^fee

stamp ^onan

appeal ^or appl1cation ^for

revision;

(e) ^theother manner ^mwhich^anotice

may^be

served;

(f) ^the

procedure ^for

inspection ^and

taking copies ^of records and accounts;

(g) ^{the feestobe}

paid ^forany^ofthematters

provided 1n this

Act;

and

(h) any other

matter which ^{has to be, or may}be, prescribed

(3)

Every ^1ulemadeunder ^thissection shall ^be

laid, as soon ^as

may be after

it

is

made,

before the

Legislative Assembly,

while^{it is in}

session, ^foratotal

period ^of

thirty

days, which may^be

comprised

in^onesessmn ^orin^twosuccessrve sessmns, and

if,

before the expiry of

the sessron ⁱⁿ

which

it is so laid ^orthe

sess1on

immediately

following,

the

Legislative Assembly

makes^anymodlfication ^{1ntherule or}decides ^that the rule

should^notbe

made, ^theruleshall thereafter

have effect

only ^in-suchmodified ^{form orbeofno}

effect, ^{as the case} may be; ^sohowever that any such modification ^or annulment

shall ^beWithout

prejudice ^to

the

172

21 Power

to remove difiiculties.—If any difficulty

arises in

giving

efl'ect to

the

provisrons ^of

this

Act,

the

Government may, ^asoccasion may

require,

by

order do

anything ^notincon— sistent ^{with the}prowsmns^ofthlsActwhich appears^tothem necessary for the purpose of

removing

the

difficulty.

22.

Repeal

and

saving —(1)

The

Kerala

Tax on

Luxuries in Hotels

and

Lodging

Houses

Ordinance,

1976

(5

of

1976),

is hereby

repealed.

(2)

Notwithstanding ^such

repeal,

anything ^doneor

any action taken under^the

said Ordinance shall be deemed to have been done ^or

taken

under

this Act.