# State of Kerala & Another v. Asianet Satellite Communications Ltd. & Others

- **Citation:** 2025 INSC 757
- **Court:** Supreme Court of India
- **Decided:** 2025-05-22
- **Case number:** Civil Appeal No. 9301 of 2013
- **Bench:** B.V. Nagarathna, Nongmeikapam Kotiswar Singh
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/state-of-kerala-another-v-asianet-satellite-communications-ltd-others-38724
- **Pages:** 233

## Headnote

The questions for consideration were: 1) Whether appellantsassessees, engaged in broadcasting of signals etc. through
television channels to subscribers of those channels, were liable
to pay entertainment tax under provisions of respective State
enactments relatable to Entry 62 - List II of the Seventh Schedule of
the Constitution and also liable to pay service tax under provisions of
the Finance Act, 1994 as amended from time to time as a provider
of a taxable service namely broadcasting service within the scope
and ambit of Entry 97-List I; and 2) Whether decision of Supreme
Court in Purvi Communication had failed to consider the tests laid
down in Geeta Enterprises and to that extent was per incuriam.
Headnotes†
Constitution of India - Seventh Schedule - List I, Entry 97 and
List II, Entry 62 - Different aspects of same activity - Taxation
under two different legislations by two different legislatures -
Assessees, engaged in broadcasting of signals etc. through
television channels to subscribers of those channels - If liable
to pay entertainment tax under provisions of respective State
enactments relatable to Entry 62 of List II and also liable to
pay service tax as a provider of a taxable service namely
broadcasting service within the scope and ambit of Entry 97
of List I:
Held: There are two aspects in the activity undertaken by the
assessees - The first is the act of transmission of signals of the
content to the subscribers - The second aspect here concerns
not only the content of the signals, but the effect of the decryption
of the signals by the Set-Top Boxes and the viewing cards inside
these boxes provided by the assessees to the subscribers, which
* Author
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is providing and receiving of entertainment through the television -
Without the apparatus provided for by the assessees to decrypt the
signals, the subscriber would not be able to watch the content that
is transmitted, the content being for the purpose of entertainment -
The television entertainment provided by them through their modus
operandi i.e., by broadcasting, is a luxury within the meaning
of Entry 62 of List II - The assessees who are engaged in the
activity of providing entertainment are liable to pay service tax on
the activity of broadcasting under the provisions of the Finance
Act, 1994 read with relevant amendments and are also liable to
pay entertainment tax in terms of Entry 62 of List II as being a
specie of luxuries - Therefore, both the taxes, one by the State
Legislature and the other, by the Parliament are leviable on the
activity of the assessees - This is because by rendering the service
of broadcasting, the assessees are entertaining the subscribers
within the meaning of Entry 62 of List II -There is no overlapping
in fact or in law, inasmuch as different aspects of the same activity
are being taxed under two different legislations by two different
legislatures - This is because the activity of broadcasting is a service
and liable to service tax imposed by the Parliament (Entry 97 of
List I) and the activity of entertainment is a subject falling under
Entry 62 of List II and therefore, the assessees herein are liable
to pay entertainment tax as well - Hence, the State Legislatures
as well as the Parliament, both have the legislative competence
to levy entertainment tax as well as service tax respectively on the
activity carried out by the assessees herein. [Para 17.37]
Doctrines - Aspect theory - Double aspect doctrine - A tool of
constitutional interpretation used in Canada to resolve issues
which arise when both the federal and provincial government
have the right to legislate on a subject - Usage of aspect
theory in the Indian context - Discussed:
Held: In India, there appears to be no clarity on the application of
the aspect theory in the Canadian sense - One of the reasons being
that in India, both the Parliament as well as the State Legislature
do not have powers to levy tax on the same sub

## Text

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[2025] 5 S.C.R. 2215 : 2025 INSC 757
State of Kerala & Another
v.
Asianet Satellite Communications Ltd. & Others
(Civil Appeal No. 9301 of 2013)
22 May 2025
[B.V. Nagarathna* and Nongmeikapam Kotiswar Singh, JJ.]
Issue for Consideration
The questions for consideration were: 1) Whether appellantsassessees, engaged in broadcasting of signals etc. through
television channels to subscribers of those channels, were liable
to pay entertainment tax under provisions of respective State
enactments relatable to Entry 62 - List II of the Seventh Schedule of
the Constitution and also liable to pay service tax under provisions of
the Finance Act, 1994 as amended from time to time as a provider
of a taxable service namely broadcasting service within the scope
and ambit of Entry 97-List I; and 2) Whether decision of Supreme
Court in Purvi Communication had failed to consider the tests laid
down in Geeta Enterprises and to that extent was per incuriam.
Headnotes†
Constitution of India - Seventh Schedule - List I, Entry 97 and
List II, Entry 62 - Different aspects of same activity - Taxation
under two different legislations by two different legislatures -
Assessees, engaged in broadcasting of signals etc. through
television channels to subscribers of those channels - If liable
to pay entertainment tax under provisions of respective State
enactments relatable to Entry 62 of List II and also liable to
pay service tax as a provider of a taxable service namely
broadcasting service within the scope and ambit of Entry 97
of List I:
Held: There are two aspects in the activity undertaken by the
assessees - The first is the act of transmission of signals of the
content to the subscribers - The second aspect here concerns
not only the content of the signals, but the effect of the decryption
of the signals by the Set-Top Boxes and the viewing cards inside
these boxes provided by the assessees to the subscribers, which
* Author
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is providing and receiving of entertainment through the television -
Without the apparatus provided for by the assessees to decrypt the
signals, the subscriber would not be able to watch the content that
is transmitted, the content being for the purpose of entertainment -
The television entertainment provided by them through their modus
operandi i.e., by broadcasting, is a luxury within the meaning
of Entry 62 of List II - The assessees who are engaged in the
activity of providing entertainment are liable to pay service tax on
the activity of broadcasting under the provisions of the Finance
Act, 1994 read with relevant amendments and are also liable to
pay entertainment tax in terms of Entry 62 of List II as being a
specie of luxuries - Therefore, both the taxes, one by the State
Legislature and the other, by the Parliament are leviable on the
activity of the assessees - This is because by rendering the service
of broadcasting, the assessees are entertaining the subscribers
within the meaning of Entry 62 of List II -There is no overlapping
in fact or in law, inasmuch as different aspects of the same activity
are being taxed under two different legislations by two different
legislatures - This is because the activity of broadcasting is a service
and liable to service tax imposed by the Parliament (Entry 97 of
List I) and the activity of entertainment is a subject falling under
Entry 62 of List II and therefore, the assessees herein are liable
to pay entertainment tax as well - Hence, the State Legislatures
as well as the Parliament, both have the legislative competence
to levy entertainment tax as well as service tax respectively on the
activity carried out by the assessees herein. [Para 17.37]
Doctrines - Aspect theory - Double aspect doctrine - A tool of
constitutional interpretation used in Canada to resolve issues
which arise when both the federal and provincial government
have the right to legislate on a subject - Usage of aspect
theory in the Indian context - Discussed:
Held: In India, there appears to be no clarity on the application of
the aspect theory in the Canadian sense - One of the reasons being
that in India, both the Parliament as well as the State Legislature
do not have powers to levy tax on the same subject - The aspect
theory has been applied in India essentially to ascertain whether an
activity would fall within the scope and ambit of an enactment and
whether the said enactment in pith and substance would fall within
an Entry of a particular List of the Seventh Schedule so as to confer
legislative competence to tax that aspect of the activity - Aspect
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State of Kerala & Another v.
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theory has no relevance, as such, in determining the constitutionality
of any provision on the ground of legislative competence in India -
Aspect theory is however relevant to determine the applicability of
a taxing statute on the activity or transaction sought to be taxed i.e.,
whether the statute covers an activity which falls within a specific
taxation entry, either in List I or in List II - Thus, an activity could be
taxed by two different legislatures on the basis of the entries in the
respective Lists without there being a clash and within their legislative
competence - However, the aspect of the activity which is being
taxed must be relatable to the legislation under a specific entry of
a particular List so as to be within the legislative competence of a
particular legislature - Thus, the aspect theory is used to determine
if, in fact, there are different aspects within the activity sought to be
taxed and whether the taxable event which forms the basis of the
levy in a legislative enactment corresponds to any aspect in the
activity sought to be taxed - This is in contrast to the applicability of
this theory in Canada, where this theory is used therein to determine
legislative competence of a federal or provincial legislature to enact
a particular law. [Paras 17.27, 17.33-17.36]
Taxation - Activity of Broadcasting service - Application of
Aspect theory - Both entertainment tax as well as service
tax can be imposed on the activity of broadcasting through
television for the purpose of entertainment of the subscriber
or the receiver thereof - The two taxes are different aspects
of the same activity which enable two different legislatures to
impose tax under distinct taxation entries in two different Lists:
Held: One aspect of an activity, say broadcasting service, can
be amenable to service tax, while the other aspect of the same
activity, namely, providing (of) entertainment to television viewers
(as that is the object of broadcasting) can be amenable to "luxury
tax" under Entry 62 List II of the Constitution which could be levied
on the recipients of such entertainment or on the service providers
who are essentially broadcasters - Broadcasting service being a
taxable service under the provisions of the Finance Act, 1994, read
along with the amendments made from time to time would enable
both the Parliament to impose service tax on broadcasting service
and the State Legislatures having the legislative competence to
levy entertainment tax on those who provide entertainment to the
recipients (television viewers) to impose a luxury tax - Entry 62
of List II contemplates a tax on entertainments or amusements
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as objects on which a tax can be imposed and therefore it is not
possible to differentiate between an entertainment provider and
an entertainment receiver - The principle is well settled that two
taxes which are separate and distinct imposed on two aspects of
an activity are permissible, as in law, there is no overlapping -
This is because the taxes are relatable to distinct taxation entries
in separate legislative Lists - In the instant case, the Parliament
under the Finance Act, 1994 and its amendments is not imposing
a tax on entertainment - Such a tax is being imposed by the State
Legislatures as entertainment is a luxury within the meaning of
Entry 62 of List II - In the same way, the Finance Act along with
its amendments seeks to impose a tax on the service rendered
by the broadcasting agency which is imposed under Entry 97
of List I - In the same vein, under Entry 62 of List II, the State
Governments are not imposing any service tax on the assessees.
[Paras 17.27, 17.28, 17.30, 17.31]
Constitution of India - Articles 246, 248 and Seventh Schedule,
List I, II & III - Constitutional Scheme regarding distribution
of Legislative Powers - Legislative competence to levy a
tax - Expression "subject to" and "with respect to" in Article
246 - Applicability of doctrine of pith and substance:
Held: Taxation entries under List I and List II (there being no
taxation entry in the Concurrent List) are clearly demarcated within
the scope of the entries in the aforesaid respective Lists - Subject
of taxation is considered to be a distinct matter for the purposes of
legislative competence and the power to tax cannot be deduced
from the general legislative entry as an ancillary power - Also, a
power to legislate as to the principal matters specifically mentioned
in the entries shall also include within its expanse, a legislation
touching upon incidental and ancillary matters - This principle is
derived from the use of the expression "with respect to" in Article
246 of the Constitution - Entry 97 of List I which is a residuary
entry relatable to Article 248 of the Constitution cannot be invoked
or pressed into service when a particular entry empowering the
Parliament or the Legislature of a State to pass laws regarding the
taxation on any subject is specifically enumerated either in List I
or List II - Consequently, as there is no taxation entry in List III,
both the Parliament as well as the Legislature of the State cannot
have competence to levy tax on any one subject of a List - While
interpreting taxation entries in List I or List II, i.e., while determining
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State of Kerala & Another v.
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the legislative competence to levy a tax, all efforts must be made
to interpret them in such a way as to give expansive content and
meaning to the same having regard to the constitutional scheme
under which the distribution of legislative powers has been
envisaged in the Seventh Schedule and bearing in mind the object
and intent behind them and also the advances made in human
thought and technology - The expression "subject to" and "with
respect to" in Article 246 of the Constitution aids the applicability
of the doctrine of pith and substance to find out the true character
of the enactment and the entry within which it would fall - The
said doctrine is applied to resolve an issue regarding legislative
competence of a legislature to enact a particular law in relation to a
subject relatable to an Entry in a List under the Seventh Schedule
of the Constitution - Any apparent conflict with respect to an entry
in another List is resolved on the basis of the pith and substance
doctrine. [Paras 17.7-17.10, 17.12, 17.13]
Doctrines - Doctrine of pith and substance - If a law is in its
pith and substance within the competence of the Legislature
which has made it, it will not be invalid because it incidentally
touches upon the subject lying within the competence of
another Legislature:
Held: Where there is an apparent overlapping between two
legislative entries in the Lists of Seventh Schedule of the
Constitution, the doctrine of pith and substance is applied to find
out the true character of the enactment concerned and the entry
within which it would fall - The doctrine of pith and substance, in
short, means, if an enactment substantially falls within the powers
expressly conferred by the Constitution upon the legislature
which enacted it, the same cannot be held to be invalid merely
because it incidentally encroaches on matters assigned to another
legislature - Also, in a situation where there is overlapping, the
said doctrine has to be applied to determine to which entry, a piece
of legislation could be related to by examining the true character
of the enactment or a provision thereof - Due regard must be
had to the enactment as a whole and to its scope and objects -
Question of invasion into another legislative territory has to be
determined by substance and not by degree - The doctrine of
pith and substance is applied to consider the vires of a legislation
impugned on the basis of the principle of legislative competence in
the context of legislative relationship between the Centre and the
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State - Constitutional validity of a taxing statute on the ground of
legislative competence has to be examined in the context of the
doctrine of pith and substance as envisaged under Article 246 of
the Constitution of India read with the respective entries in the
List -Once the contours of an entry under which a legislation is
sought to be made is ascertained, the next step is to study the
legislation in question in order to ascertain whether it falls within
the contours of that Entry - If it does fall within the contours of a
particular entry in a particular List, then that particular legislature
which has enacted it would have the legislative competence to
enact such a legislation - But a legislation incidentally touching
upon an entry in another List does not render it invalid, it means
that so long as a piece of legislation is in pith and substance
falling within an entry in a particular List, it would be valid as the
legislature which has enacted it, has the legislative competence
to do so. [Paras 8.2.2, 17.33]
Taxation - Parameters of Taxation, as enumerated by Supreme
Court in Govind Saran Ganga Saran, discussed:
Held: A legislative enactment which provides for the imposition
of a tax must specify the following parameters of taxation: (i) The
taxable event which forms the basis of levy, also referred to as
"subject" of a tax; (ii) The measure of the tax; (iii) The rate(s) of
taxation; and (iv) The incidence of the tax - The said parameters
are each distinct and must not be conflated with the others - The
components of tax, as stated above have been characterised in
Govind Saran Ganga Saran case- In the said case, it was also
laid down that a legislative scheme which seeks to impose a tax,
ought to define each of the aforestated components with certainty
and precision. [Paras 8.26, 17.23]
Taxation - Taxation on Luxuries: Entertainments &
Amusements - Words and Expressions - "Luxuries" -
Meaning of - Bearing in mind the meaning of "entertainments" and
"amusements" and since they come within the scope of "luxuries",
therefore, the State legislature has legislative competence to impose
entertainment tax under Entry 62 of List II as a tax on luxuries -
Constitution of India - Seventh Schedule, List II, Entry 33 & 62.
[Paras 8.6-8.12, 17.20]
Words and Phrases - "Entertainments" and "Amusements" -
Meaning of - Expressions "entertainments and amusements"
[2025] 5 S.C.R.
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State of Kerala & Another v.
Asianet Satellite Communications Ltd. & Others
have to be read ejusdem generis - Constitution of India -
Seventh Schedule, List II, Entry 62:
Held: The expression "entertainments" is a word of general import
and in common parlance, it includes cinema shows, dramatic
performances, etc. - The expression 'entertainments' used in Entry
62 of List II does not draw a distinction between one who derives
amusement and one who caters to it - It covers both categories -
Expression "entertainments" cannot be interpreted in a narrow,
pedantic or in a myopic way - With the advancement in technology,
there can be several modes in which the activity of entertainment
can be provided or received - However, what is essential is
the object of providing or receiving signals etc. which must be
for the purpose of entertainment - Expression "entertainments/
entertainment" includes within its scope and ambit not only the
provider of entertainment but also the receiver, inter alia, through
the medium of television - Thus, entertainment through television
network either through cable television or DTH through set-top box
with the object of providing entertainment to the viewer can be
taxed in terms of Entry 62 of List II - The expression "amusement"
in Entry 62 of List II would mean diversion, pass time or enjoyment
or a pleasurable occupation of the senses or that which furnished
it - The expressions "entertainments and amusements" would have
to be read ejusdem generis. [Paras 8.20-8.23, 17.22]
Words and Phrases - "Entertainment" - Interpretation of -
Geeta Enterprises case versus Purvi Communication case -
Discussed:
Held: There is no contradiction in the judgments of Supreme Court
in Geeta Enterprises and Purvi Communications - Judgment in
Geeta Enterprises can never be a binding precedent for the question
raised before this Court in Purvi Communication - Discussion
on the content and meaning, scope and ambit of the expression
'entertainments' in Geeta Enterprises is not comprehensive - This
is because, having regard to the advances in technology resulting
in varied forms of entertainments through various media and in a
variety of ways, not only in a public place but also in the confines
of private space such as a home, through mobile or a cell phone
or smart watch and other personal devices etc., the expression
'entertainments' must be given a broad, liberal and expansive
meaning than what has been discussed in Geeta Enterprises by
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this Court - Purvi Communication is not per incuriam and need not
be referred to a larger Bench. [Paras 10.6, 10.14, 17.24, 17.25]
Words and Phrases - "Broadcasting" and "Broadcasting
agency or organization" - Prasar Bharti (Broadcasting
Corporation of India) Act, 1990 - Section 2(c) - Finance Act,
1994 as amended by the Finance Act, 2001 - Section 65(13).
[Para 17.14-17.18]
Constitution of India - Seventh Schedule, Lists I, II & III - Fee
in respect of any of the matters in the three Lists - Does not
include the power to levy tax - Distinction between levy of
fee and levy of tax. [Para 17.11]
Service Tax - Service tax on broadcasting agency - Finance
Act, 1994 as amended by the Finance Act, 2001 - Sections
65(72)(zk) and 66.
Held: Broadcasting service is a taxable service and the broadcasting
service provider is required to pay service tax under the provisions
of the Finance Act, 1994 as amended from time to time. [Para 17.19]
Case Law Cited
State of West Bengal v. Purvi Communication Pvt. Ltd. [2005] 2
SCR 954 : (2005) 3 SCC 711 - held not per incuriam.
Western India Theatres v. Cantonment Board, Poona [1959]
Supp. 2 SCR 63 - followed.
Union of India v. H.S. Dhillon [1972] 2 SCR 33 : (1971) 2 SCC 779;
MPV Sundararamier & Co. v. State of Andhra Pradesh [1958] SCR
1422 : AIR 1958 SC 468; M/s Hoechst Pharmaceuticals Ltd. v.
State of Bihar [1983] 3 SCR 130 : AIR 1983 SC 1019 - relied on.
Anjum Kadari v. Union of India, 2024 INSC 831 : [2024] 11 SCR
365; P.M. Ashwathanarayana Setty v. State of Karnataka [1988]
Supp. 3 SCR 155 : (1989) Supp. 1 SCC 696; R.K. Garg v. Union
of India [1982] 1 SCR 947 : (1981) 4 SCC 675; Kodar v. State
of Kerala [1975] 1 SCR 121 : (1974) 4 SCC 422; Kerala Hotel
and Restaurant Association v. State of Kerala [1990] 1 SCR
516 : (1990) 2 SCC 502; Ganga Sugar Corporation Ltd. v. State
of Uttar Pradesh [1980] 1 SCR 769 : (1980) 1 SCC 223; Income
Tax Officer, Shillong v. R. Takin Roy Rymbai [1976] 3 SCR 413:
(1976) SC 670; State of Kerala v. Mar Appraem Kuri Company Ltd.
[2025] 5 S.C.R.
2223
State of Kerala & Another v.
Asianet Satellite Communications Ltd. & Others
[2012] 4 SCR 448 : (2012) 7 SCC 106; Bharat Sanchar Nigam
Limited v. Union of India [2006] 2 SCR 823 : (2006) 3 SCC 1;
K. Damodarasamy Naidu & Bros. v. State of Tamil Nadu [1999]
Supp. 3 SCR 597 : (2000) 1 SCC 521; Association of Leasing
& Financial Service Companies v. Union of India [2010] 13 SCR
381 : (2011) 2 SCC 352; Special Reference No.1 of 2001, In Re:
Association of Natural Gas v. Union of India [2004] 3 SCR 534 :
(2004) 4 SCC 489; Federation of Hotel & Restaurant Association
of India v. Union of India [1989] 2 SCR 918 : (1989) 3 SCC 634;
All India Federation of Tax Practitioners v. Union of India [2007] 9
SCR 527; Godfrey Phillips Ltd. v. State of U.P. [2005] 1 SCR 732 :
(2005) 2 SCC 515; Geeta Enterprises v. State of Uttar Pradesh
[1983] 3 SCR 812 : (1983) 4 SCC 202; Commissioner of Central
Excise and Customs, Kerala v. Larsen and Toubro Ltd. [2015] 8
SCR 1046 : (2016) 1 SCC 170; Hoechst Pharmaceuticals Ltd. v.
State of Bihar [1983] 3 SCR 130 : (1983) 4 SCC 45; Bharat Sanchar
Nigam Limited, Imagic Creative (P) Ltd. v. CCT [2008] 1 SCR
457 : (2008) 2 SCC 614; Larsen and Toubro Limited v. State of
Karnataka [2013] 17 SCR 678 : (2014) 1 SCC 708; Commissioner
of Income Tax, Bangalore v. B.C. Srinivasa Setty [1981] 2 SCR
938 : (1981) 2 SCC 460; Govind Saran Ganga Saran v. CST [1985]
3 SCR 985 : 1985 Supp. SCC 205; Express Hotels (P) Ltd. v.
The State of Gujarat [1989] 2 SCR 893 : 1989 3 SCC 677; State
of Karnataka v. State of Meghalaya [2022] 18 SCR 516 : (2023)
4 SCC 416; Suresh v. State of T.N. [1996] Supp. 8 SCR 947 :
(1997) 1 SCC 319; CCE v. Grasim Industries Ltd. [2018] 6 SCR
1099 : (2018) 7 SCC 233; Mineral Area Development Authority v.
Steel Authority of India [2024] 7 SCR 1549 : 2024 SCC OnLine
SC 1796; Navinchandra Mafatlal v. Commissioner of Income-Tax,
Bombay City [1955] 1 SCR 829 : AIR 1955 SC 58; Chhotabhai
Jethabhai Patel and Co. v. Union of India [1962] Supp. 2 SCR
1 : AIR 1962 SC 1006; Calcutta Gas Company Ltd. v. State of
West Bengal [1962] Supp. 3 SCR 1: AIR 1962 SC 1044; RMD
Chamarbaugwalla v. Union of India [1957] SCR 930 : AIR 1957
SC 628; Builders' Association of India v. Union of India [1989] 2
SCR 320 : (1989) 2 SCC 645; A.B. Abdul Kadir v. State of Kerala
[1976] 2 SCR 690 : (1976) 3 SCC 219; Bangalore Turf Club Ltd. v.
Regional Director, ESI Corporation [2014] 8 SCR 1021 : (2014) 9
SCC 657; State of Karnataka v. Drive-in Enterprises [2001] 2 SCR
378 : (2001) 4 SCC 60; M.J. Sivani v. State of Karnataka [1995] 3
SCR 329 : AIR 1995 SC 1770; State of M.P. v. Abha Sethi [1999]
2224
[2025] 5 S.C.R.
Supreme Court Reports
2 SCR 930 : (1999) 4 SCC 32; Goodyear India Ltd. v. State of
Haryana [1989] Supp. 1 SCR 510 : (1990) 2 SCC 71; International
Tourist Corporation v. State of Haryana [1981] 2 SCR 364; Elel
Hotels & Investments Ltd. v. Union of India [1989] 2 SCR 880 :
(1989) 3 SCC 698; State of West Bengal v. Kesoram Industries Ltd.
[2004] 1 SCR 564 : (2004) 10 SCC 201; Union of India v. Mohit
Minerals Pvt. Ltd. [2018] 13 SCR 139; State of Andhra Pradesh v.
Mc Dowell & Co. [1996] 3 SCR 721; Gujarat Ambuja Cements
Ltd. v. Union of India [2005] 2 SCR 1038 : (2005) 4 SCC 214;
Laghu Udhyog Bharti v. Union of India [1999] 3 SCR 1199 : (1999)
6 SCC 418; Rai Ramakrishna v. State of Bihar [1964] 1 SCR 897:
AIR 1963 SC 1667; Tata Sky Ltd. v. State of M.P. [2013] 2 SCR
849 : (2013) 4 SCC 656; East India Tobacco Company v. State
of Andhra Pradesh [1963] 1 SCR 404; TwyFord Tea Co. v. State
of Kerala [1970] 3 SCR 383 : (1970) 1 SCC 189 - referred to.
Prafulla Kumar Mukherjee v. Bank of Commerce, Khulna, AIR
1947 P.C. 60; A.L.S.P.P.L. Subrahmanyan Chettiar v. Muttuswami
Goundan, AIR 1941 FC 47; United Provinces v. Atiqa Begum,
AIR 1941 FC 16; Re: The Central Provinces and Berar Sales of
Motor Spirit and Lubricants Taxation Act, 1938, AIR 1939 FC 1;
Governor General in Council v. Province of Madras (1945) FCR
179: AIR 1945 PC 98 - referred to.
Tata Sky Limited v State of Uttarakhand, Writ Petition (M/B) No.
4 of 2010; Bharti Telemedia Ltd. v. Government of NCT of Delhi,
W.P.(C) No. 4935 of 2011; M/s. Tata Sky Ltd. v. State of Orissa,
Writ Petition (C) No. 8966 of 2011; Cantonment Board Poona v.
Western India Theatres Ltd., AIR 1954 BOM 261; Tamil Nadu Cable
TV Organisers v. Government of Tamil Nadu, W.P. No. 16237/1994;
Tamil Nadu Cable TV Organisers Association v. Government of
Tamil Nadu, W.P. No.10013 of 1994 dt. 30.11.1994; Vasant Madhav
Patwardhan v. State of Maharashtra, 2000 SCC OnLine Bom
244; Gopal Krishna Agarwal v. State of Uttar Pradesh (1982) All.
L.J. 607; Sky Vision T.V v. State of Bihar, 1995 (2) BJLR 845;
Dish TV India Ltd. v. State of Uttarakhand, W.P. (M/S) No. 2562
of 2007; Tata Sky Ltd. v. State of M.P., W.P. No.10148 of 2009;
A. Thangal Kunju Musaliar v. M. Venkatachalam Potti (1956) 29
ITR 349 - referred to.
Lyle Francis Smith v. Her Majesty the Queen [1960] SCR 776;
Union Colliery Co. of British Columbia v. Bryden, 1899 AC 580 -
referred to.
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Books and Periodicals Cited
Oxford English Dictionary, Second Edition, Volume IX; P. Ramanatha
Aiyar's Advanced Law Lexicon, 6th Edition, Volume II; Reader's
Digest Family Word Finder; Webster's Third New International
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Canada's Federal System by A.H.F. Lefroy; Tax, Constitution and
the Supreme Court by Sri Karthik Sundaram (OakBridge, 2024);
Chapter by Sri V. Niranjan, K.C. in Oxford Handbook of the Indian
Constitution; Cooley on Taxation - referred to.
List of Acts
Constitution of India; Finance Act, 1994; Finance Act, 2002;
Finance Act, 2003; Finance Act, 2004; The Kerala Tax on Luxuries
Act,1976; Uttarakhand (Uttar Pradesh Entertainment and Betting
Tax Act, 1979; Rajasthan Entertainments & Advertisements Tax
Act, 1957; Rajasthan Entertainments & Advertisements Tax Rules,
1957; Gujarat Entertainment Tax (Amendment) Act, 2009; Gujarat
Entertainment Tax (Exhibition by means of Direct-to Home (DTH)
Broadcasting Services) Rules, 2010; Jharkhand Entertainment
Tax Act, 2012; Uttar Pradesh Entertainments and Betting Tax
(Amendment) Ordinance, 2009; Uttarakhand (Uttar Pradesh
Entertainment and Betting Tax Act, 1979) (Amendment) Act, 2009;
Punjab Entertainment Duty Act, 1955; The Delhi Entertainments
and Betting Tax Act, 1996; Delhi Entertainments and Betting Tax
(Amendment) Rules, 2010; The Assam Amusement and Betting
Tax Act, 1939; The Orissa Entertainment Tax Act, 2006; Orissa
Entertainment Tax (Amendment) Act, 2010; The Tamil Nadu
Entertainments Tax Act, 1939.
List of Keywords
Entertainment Tax; Service Tax; Broadcasting Services; DTH
Operators; Aspect Theory; Pith and Substance; Entry 62 List II;
Entry 97 List I; Entry 31 List I; Legislative Competence; Taxing
Power; Constitutional Law; Centre State Relations; Double Taxation;
Residuary Powers; Federalism; Overlapping Jurisdiction; Cable
Television; Private Entertainment; Public Entertainment; Judicial
Review; Tax on Luxuries; Interpretation of Constitution; Harmonious
Construction; Doctrine of Aspect; Doctrine of Pith and Substance;
Entry 92C List I; Taxability of Services; State Tax Vs Central Tax;
Communication Services; Ministry of Information and Broadcasting;
2226
[2025] 5 S.C.R.
Supreme Court Reports
Set Top Box; Direct to Home Broadcasting; Finance Act 1994;
Negative List Regime; Broadcasting and Communication; Purvi
Communication Case; Geeta Enterprises Case; Bharat Sanchar
Nigam Case; Godfrey Phillips Case; Entry-Based Interpretation;
Concurrent List; Taxable Event; Union List; State List; Discriminatory
Taxation; Tax on Admission; Constitutional Entry Interpretation;
Substantial Nexus; Doctrine of Colorable Legislation.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 9301 of 2013
From the Judgment and Order dated 28.06.2012 of the High Court
of Kerala at Ernakulam in WPC No. 33966 of 2006
With
Civil Appeal Nos. 1629, 1765-1766, 1531, 1533, 1534, 1752, 1753,
1755, 1532, 1687, 1688, 1689, 1690, 1548-1549, 1630, 1726,
1725, 1543, 1547, 1680, 1754, 1756, 1530, 1628, 1535, 1679,
1681-1682, 1683, 1684, 1685, 1686, 1580, 1581-1583 and 1536
of 2020, Civil Appeal No. 10114 of 2011, Civil Appeal Nos. 2147,
5867 and 5228 of 2012, Writ Petition (C) No. 699 of 2014, Writ
Petition (C) No. 748 of 2015, SLP (C) No. 9025 of 2023.
Appearances for Parties
Advs. for the Appellants:
Pallav Shisodiya, K.K. Venugopal, S.K.Bagaria, Tarun Gulati,
Arvind P. Datar, Pallav Shisodiya, Sr. Advs., Nishe Rajen Shonker,
Mrs. Anu K Joy, Alim Anvar, Ajith Anto Perumbully, Riddhi Bose,
Ms. Racheeta Chawla, Ms. Rishi Agarwal, Sampriti Baksi, Mahesh
Agarwal, Rishi Agrawala, Manu Krishnan, Kamaldeep Dayal,
Victor Das, Ms. Madhavi Agrawal, Ms. Madhvi Agarwal, Vipul
Singh, Ashwini Kumar, Ms. Chitra Agarwal, Ms. Anwesha Padhi,
Ms. Manavi Agarwal, Chinmayee Chandra, Ankur Talwar, Yash Jain,
Ajit Kr. Singh, E. C. Agrawala, Vivek Sarin, Aakarshan Aditya, Dibya
Prashant Singh, Satish C. Kaushik, Dhruv Dev Gupta, Sahil Bhalaik,
Tushar Giri, Siddharth Anil Khanna, Ritik Arora, Shivam Mishra,
Gowtham Polanki, Ms. Gulshan Jahan, Md. Rashid Saeed, Harish
Pandey, Gopal Singh, Akhilesh Kumar Pandey, M/S. Acm Legal,
Dr. Shashwat Bajpai, Rohit Amit Sthalekar, Purnendu Bapai,
Shashank Singh, Mahir Khanna, Sahil Tagotra, Ms. Shankari
Mishra, Sujay Jain, Rakesh Talukdar, Ms. Abhivyakti Banerjee,
[2025] 5 S.C.R.
2227
State of Kerala & Another v.
Asianet Satellite Communications Ltd. & Others
Ashwani Kumar Dubey, Praveen Kumar, C. K. Sasi, Ms. Nayantara,
Dinesh Dahiya, Ms. Meena K Poulose, Kumar Visalaksh, Udit
Jain, Ajitesh Dayal Singh, Devansh Garg, Harish Pandey, Praveen
Kumar, Abhishek Vikas, Nishe Rajen Shonker, Mrs. Anu K Joy,
Alim Anvar, Ajith Anto Perumbully, Riddhi Bose, Ms. Racheeta
Chawla, Ms. Rishi Agarwal, Ms. Sampriti Baksi.
Advs. for the Respondents:
K M Nataraj, N.Venkatraman, A.S.Gs., Shadan Farasat, Sr. A.A.G.,
Gurminder Singh A.G. Punjab, K N Balgopal Advocate General
of State of Nagaland, S. K. Bagaria, Tarun Gulati, Mrs. Shirin
Khajuria, Dr. Manish Singhvi, Arunabh Chowdhury, Preetesh
Kapur, K Radhakrishnan, Nalin Kohli, Ms. Nisha Bagchi, V. K.
Khanna, Sanjay Kharde, Saurabh Mishra, Jaideep Gupta, Sr.
Advs., M/s. Corporate Law Group, Ms. Bhavana Duhoon, Kumar
Ajit Sinha, Ms. Swati Tiwari, Devansh Garg, Anshul Syal, Kumar
Sambhav, Shantanu Sagar, Anil Kumar, Gunjesh Ranjan, Manoneet
Dwivedi, Ms. Pallavi Langar, Manoj Kumar, Sujeet Kumar C.,
Ankit Khatri, Bhakti Vardhan Singh, Milind Kumar, Apurv Singhvi,
Ms. Shalini Haldar, Ms. Yasha Goyal, Rajiv Shanker Dvivedi,
Ms. Tulika Mukherjee, Shwetank Singh, V. Aravind, Ms. Rooh-ehina Dua, Harshit Khanduja Khanduja, Harshit Khanduja, Ankit
Khera, Abhishek Babbar, Mrs. Kirti Renu Mishra, Sanjay Dutt,
Ms. Deepanwita Priyanka, Mukesh Kumar Maroria, Sabarish
Subramanian, C Kranthi Kumar, Vishnu Unnikrishnan, Danish
Saifi, Shuvodeep Roy, Anshul Malik, Shruti Agrawal, Anando
Mukherjee, Abhay Pratap Singh, M. P. Vinod, Krishnanand Pandeya,
Ms. Swati Ghildiyal, Ms. Devyani Bhatt, Ms. Srujana Suman
Mund, Abhishek Atrey, Rajat Mittal, K. V. Vijayakumar, Samir
Ali Khan, Sanjay Kapur, Ms. Isha Virmani, Ms. Mahima Kapur,
Mrs. Shubhra Kapur, Gurmeet Singh Makker, V C Bharathi, Rajat
Nair, Adit Khorana, Udai Khanna, Shivank Pratap Singh, Sarthak
Karol, Chandan Kumar, Manish Kumar, Dharmendra Kumar Sinha,
Raj Bahadur Yadav, Surjendu Sankar Das, Anand Murthi Rao,
B. Krishna Prasad, Hitesh Kumar Sharma, Amit Kumar Chawla,
Varun Varma, Ms. Tanishka Grover, Akhileshwar Jha, Ms. Sandhya
G., Kamal Mohan Gupta, Siddharth Dharmadhikari, Aaditya
Aniruddha Pande, Bharat Bagla, Sourav Singh, Aditya Krishna,
Ms. Preet S. Phanse, Adarsh Dubey, Sachin Patil, Sarad Kumar
Singhania, Sunny Choudhary, Sarad Kumar Singhania, Ms. Rashmi
Singhania, Avijit Mani Tripathi, P. V. Yogeswaran, Ms. K. Enatoli
Sema, Ms. Limayinla Jamir, Amit Kumar Singh, Ms. Chubalemla
2228
[2025] 5 S.C.R.
Supreme Court Reports
Chang, Prang Newmai, Ms. Nitya Nambiar, Sameer Abhyankar,
Rahul Kumar, Ms. Ayushi Bansal, Aryan Srivastava, Sarthak Dora,
Ms. Astha Sharma, Srisatya Mohanty, Himanshu Chakravarty,
Ms. Riddhi Bose, Ms. Racheeta Chawla, Simranjeet Singh Rekhi,
Ms. Sampriti Bakshi, Rishi Agarwal, Siddharth Banerjee, M/s. Plr
Chambers And Co., M/s. Venkat Palwai Law Associates, Ms. Devina
Sehgal, Mahfooz Ahsan Nazki, Gopal Singh, Akshat Kumar, Ms. G.
Indira, Vatsal Joshi, Krishna Kant Dubey, Ms. Indira Bhakar, Harish
Pandey, Shashwat Parihar, Ms. Priyadarshini Priya, Rajesh Singh
Chauhan, Ms. Priyanka, Shreekant Neelappa Terdal, Ms. Shashi
Kiran, D. S. Mahra, Rajiv Kumar Choudhry, V. N. Raghupathy,
Vishwanath P. Allannavar, Divyanshu Kumar Srivastava.
Judgment / Order of the Supreme Court
Judgment
Nagarathna, J.
I N D E X*
1.
Bird's Eye View of the Controversy: ........................................
6
2.
Facts in brief: ..............................................................................
8
3.
Writ Petitions filed before this Court: ......................................
24
a.
W.P. (C) No. 699/2014: .......................................................
24
b.
W.P. (C) No.748/2015: ........................................................
26
4.
Submissions: ..............................................................................
28
a.
Submissions on behalf of Appellants: ............................
28
b.
Submissions of Respondent-States: ..............................
51
i.
State of West Bengal: ..............................................
51
ii.
State of Uttar Pradesh: ............................................
53
iii.
State of Odisha: ........................................................
54
iv.
State of Tamil Nadu: .................................................
62
v.
State of Rajasthan: ..................................................
70
vi.
State of Punjab: ........................................................
71
vii.
State of Nagaland: ....................................................
71
viii. State of Andhra Pradesh: ........................................
72
ix.
Union of India: ..........................................................
72
* Ed. Note: Pagination as per the original Judgment.
[2025] 5 S.C.R.
2229
State of Kerala & Another v.
Asianet Satellite Communications Ltd. & Others
c.
Reply Arguments: .............................................................
73
5.
Points for Consideration: ..........................................................
73
6.
Legal Framework: .......................................................................
75
a.
Relevant Entries of the Seventh Schedule of the
Constitution: ......................................................................
77
b.
Finance Act, 1994 with Relevant Amendments: ............
78
c.
Relevant Provisions of the State Enactments: ..............
91
i.
Assam Amusements and Betting Tax Act, 1939: ...
91
ii.
Delhi Entertainments and Betting Tax Act, 1996: ..
94
iii.
Gujarat Entertainments Tax Act, 1977: ..................
96
iv.
Jharkhand Entertainment Tax Act, 2012: ..............
104
v.
Kerala Tax on Luxuries Act, 1976: ......................... 108
vi.
Orissa Entertainment Tax Act, 2006: .....................
117
vii.
Punjab Entertainment Duty Act, 1955: ................... 120
viii. Rajasthan Entertainments and Advertisements
Tax Act, 1957: ........................................................... 128
ix.
Tamil Nadu Entertainments Tax Act, 1939: ........... 130
x.
Uttar Pradesh Entertainment and Betting Tax Act,
1979: .......................................................................... 133
7.
Interpretation of Entries of the Lists of the Seventh Schedule
of the Constitution: .................................................................... 142
8.
State of Karnataka vs. State of Meghalaya: ............................ 157
9.
Meaning and Scope of the expression "Luxuries, Entertainments
and Amusements" and Legislative Competence of State
Legislatures to impose Entertainment Tax: ............................ 162
a.
Luxuries: ............................................................................ 162
b.
Entertainments and Amusements: .................................. 168
c.
Amusement: ....................................................................... 171
10. Parameters of Taxation: ............................................................. 180
11. Relevant case law: ....................................................................
184
a.
Suresh: ..............................................................................
184
b.
Vasant Madhav Patwardhan: ...........................................
194
12. Geeta Enterprises vs. Purvi Communication: ........................
195
13. "Aspect Theory" or Aspect Doctrine: A Discussion .............. 217
14. Criticism of its Use in Indian Context: ....................................
219
2230
[2025] 5 S.C.R.
Supreme Court Reports
15. Usage of Aspect Theory in the Indian Context: ..................... 222
16. Aspect Theory: Its Extent and Scope in India: ....................... 246
17. Application of Aspect Theory to the Case at hand: ............... 256
18. Modus Operandi of the Assessees and their aspects: .......... 260
19. Allahabad High Court's Ruling on retrospective operation
of the Amendment: ..................................................................... 265
20. State of Kerala vs. Asianet: ....................................................... 277
a.
Submissions: ..................................................................... 282
b.
Judgments relied upon by State of Kerala: .................... 283
21. Jharkhand High Court's Ruling: ............................................... 293
22. Summary of Discussion and Conclusions: ............................. 296
a.
Constitutional Scheme regarding distribution of
Legislative Powers: ........................................................... 298
b.
Service Tax: .......................................................................
303
c.
Tax on Luxuries: Entertainments & Amusements .......... 305
d.
Parameters of Taxation under State Enactments: ........
307
e.
Geeta Enterprises and Purvi Communications: ............ 308
f.
Aspect Theory: ................................................................... 310
Leave granted in Special Leave Petition (Civil) No.9025 of 2023.
1.1 Since common questions of law and facts arise in these civil
appeals and writ petitions, they have been heard together and
are being disposed of by this common judgment.
1.2 The Civil Appeals arise from the judgments of the High Courts
of Allahabad, Delhi, Gauhati, Gujarat, Jharkhand, Kerala,
Madras, Orissa, Punjab & Haryana, Rajasthan and Uttarakhand
while two writ petitions have been filed before this Court under
Article 32 of the Constitution by M/s Tata Play & Another and
M/s Tata Play Ltd.
Bird's Eye View of the Controversy:
2.
The assessees have filed these appeals assailing the provisions
of the respective State Acts under which tax on entertainment has
charged on them on the premise that their activity is relatable to
[2025] 5 S.C.R.
2231
State of Kerala & Another v.
Asianet Satellite Communications Ltd. & Others
the field of entertainment as envisaged under Entry 62 - List II of
the Seventh Schedule to the Constitution. It is their contention that
they are not liable to pay entertainment tax (or luxury tax) under the
respective provisions of the State enactments. It is further case of
the assessee that they are engaged in broadcasting of signals etc.
through television channels to the subscribers of those channels
hence, possibly they are liable to pay service tax to the Central
Government under Entry 97 - List I of the Seventh Schedule of the
Constitution. There are however two writ petitions filed by certain
assessees who have also ventilated their grievance that they are
not liable to pay service tax as well.