Allowed

The State of Goa through Chief Secretary and Anr., v. Mr. Prakash K. Kothari Proprietor of M/S Osia Multiplex

Bombay HC12 Mar 2019FA/213/2008

Case brief

AI extract

What is this about?

Appeals against decrees granting 100% reimbursement of entertainment tax as subsidy under The Goa Entertainment Tax based Subsidy for Cinema Houses (Theatres) Scheme, 2004 to multiplex operators. Reading the Scheme as a whole, the High Court held it was framed to incentivise existing theatres in bad shape to upgrade for IFFI, not brand new upgraded multiplexes, and allowed the appeals.

What did the court decide?

Both appeals allowed; impugned judgments and decrees dated 30th April, 2008 in Civil Suit Nos.33/2007 and 57/2007 set aside and the suits dismissed; respondents directed to bring back withdrawn amount

The State of Goa through Chief Secretary and Anr., Vs… — GST and Indirect Tax | Bombay HC (2019)

¶1

1 FA207&213-08

¶2

IN THE HIGH COURT OF BOMBAY AT GOA

¶3

FIRST APPEAL NO.207 OF 2008

¶4

The State of Goa, Through its Chief Secretary, having office at Secretariat, Porvorim Goa.

¶5

The Commissioner of Entertainment Tax Vikrikar Bhavan, Old High Court Building, … Panaji Goa. Appellants

¶6

Versus

¶7

Inox Leisure Limited, Having its office at Multiplex Complex, ABS Towers, Old Padre Road, Vadodara – 390 007, Gujarat and Corporate Office at 21 A, Film Center, 68 Tardeo Road, Mumbai 400 034 and represented herein by its Assistant Manager (Legal), Mr. Amit Karle, aged 27 years and residing at Dadar, Mumbai. … Respondent

¶8

Mr. Pravin Faldessai, Additional Government Advocate for the Appellants.

¶9

Mr. S. G. Desai, Senior Advocate with Mr. Yogesh Nadkarni and Mr. Sanket Kamat, Advocates for the Respondent.

¶10

2 FA207&213-08

¶11

WITH

¶12

FIRST APPEAL NO.213 OF 2008

¶13

The State of Goa, Through its Chief Secretary, having office at Secretariat, Porvorim Goa.

¶14

The Commissioner of Entertainment Tax Vikrikar Bhavan, Old High Court Building, … Panaji Goa. Appellants

¶15

Versus

¶16

Mr. Prakash K. Kothari

¶17

Proprietor of M/s Osia Multiplex, Having office at Osia Commercial Arcade, … Old Market, Margao Goa. Respondent

¶18

Mr. Pravin Faldessai, Additional Government Advocate for the Appellants.

¶19

Mr. Yogesh Nadkarni and Mr. Sanket Kamat, Advocates for the Respondent.

¶20

Coram : M. S. Sonak &

¶21

¶22

Reserved on: 18^th February, 2019

¶23

Pronounced on: 12^th March, 2019

¶24

Judgment ( Per M. S. Sonak, J)

¶25

Heard the learned counsel for the parties.

¶26

3 FA207&213-08

¶27

The learned counsel for the parties agree that the issues involved in both these appeals are one and the same and accordingly consent to the disposal of these two appeals by a common judgment and order.

¶28

First Appeal No.207 of 2008 is directed against the judgment and decree dated 30^th April, 2008 made by the learned District Judge, North Goa, Panaji in Civil Suit No.57/2007, instituted by the Respondent-Inox Leisure Limited (ILL).

¶29

First Appeal No.213 of 2008 is directed against the judgment and decree dated 30^th April, 2008 made by the learned District Judge, North Goa, Panaji in Civil Suit No.33/2007 instituted by the Respondent-Prakash K. Kothari (PKK).

¶30

By the impugned judgments and decrees, in the two suits the learned District Judge, North Goa, Panaji has directed the Appellants ( original Defendants) to pay the Respondents ( original Plaintiff ) subsidy equal to entertainment tax actually paid by the Respondents in respect of their multiplex theatres, in terms of “ The Goa Entertainment Tax based Subsidy for Cinema Houses (Theatres) Scheme, 2004” ( the said Scheme ). Aggrieved by such judgments and decrees, the Appellants ( original Defendants ) have instituted these two appeals.

¶31

4 FA207&213-08

¶32

Mr. Faldessai, learned Additional Government Advocate for the Appellants submits that the Scheme is to be read in its entirety, instead of overemphasizing on clause 4 of the said Scheme. He submits that from the reading of the said Scheme in its entirety, it is clear that the said Scheme was formulated to incentivize the existing theatres, which were in a bad shape, to upgrade themselves on account of oncoming International Film Festival of India (IFFI). He submits that the said Scheme was never intended to apply to new multiplexes already equipped with all upgraded facilities.

¶33

Mr. Faldessai submits that the learned District Judge has misconstrued the evidence of DW1. He submits that DW1 never admitted that the Respondents were covered under the said Scheme. In any case, he points out that in such matters where the interpretation of the clauses of the said Scheme was involved, opinions expressed by the Officers of the Government are hardly relevant. He submits that the learned District Judge, by overemphasizing on clause 4 of the said Scheme, has virtually rendered clauses 2 and 3 of the said Scheme, not to mention the objectives of the said Scheme, totally redundant.

¶34

Mr. Faldessai submits that the multiplexes in respect of which ILL claims reimbursement of entertainment tax is

¶35

5 FA207&213-08

¶36

constructed on Government land by an instrumentality of the Government. The ILL has only been granted a licence to operate the multiplex. The said Scheme was obviously not intended to cover the multiplex of this nature. He submits that award of any relief to ILL would virtually amount to award of bonanza to ILL and its consequent unjust enrichment. He submits that since this aspect has been totally ignored by the learned District Judge, the impugned judgments and decrees warrant interference.

¶37

Mr. Faldessai submits that Osia Multiplex established by PKK hardly a few days prior to the International Film Festival of India, was already equipped with upgraded facilities. There was no question of further incentivizing PKK. The award of any benefit to PKK in respect of such a upgraded multiplex, at which, PKK, was permitted to charge substantial amount to the consumers, would again, amount to unjust enrichment of PKK. Since, this aspect was not at all considered by the learned District Judge, the impugned judgments and decrees warrant interference.

¶38

Mr. Faldessai further submits that the learned District Judge has totally failed to consider the effect of clause 11 of the said Scheme, which clearly provides that no inherent rights are to arise out of the said Scheme in favour of any person. He submits that in the present case, neither the Respondents have made out any case

¶39

6 FA207&213-08

¶40

for promissory estoppel or even discrimination. Since, the Respondents, had no inherent right as such under the said Scheme, apart from the fact that the Respondents were not even covered under the said Scheme, the learned District Judge clearly erred in decreeing the suits instituted by the Respondents.

¶41

For all these reasons, Mr. Faldessai submits that the impugned judgments and decrees made in favour of the Respondents are liable to be set aside and the suits instituted by the Respondents are liable to be dismissed.

¶42

Mr. S. G. Desai, learned Senior Advocate for the Respondent in First Appeal No.207 of 2008 and Mr. Y. Nadkarni, learned counsel for the Respondent in First Appeal No.213 of 2008 defend the impugned judgments and decrees on the basis of reasoning reflected therein. They submit that clause 4 of the said Scheme refers to eligibility. They submit that there can be no dispute that the multiplexes established by the Respondents stand covered under the provisions of the said Scheme as was admitted by DW1 and accepted by the learned District Judge in the impugned judgments and decrees.

¶43

Mr. Desai and Mr. Nadkarni point out that there was an endorsement made by the then Chief Minister of the State of

¶44

7 FA207&213-08

¶45

Goa on the file clearly indicating that the said Scheme is applicable to new multiplexes. They submit that this endorsement/decision of the Chief Minister is reflected in the modified Scheme. They submit that in any case applying the doctrine of contemporanea expositio, the benefit of the said Scheme has to be extended to the Respondents because, this is the manner in which the Chief Minister and the Officers understood the said Scheme.

¶46

Mr. Desai and Mr. Nadkarni then point out to the deposition of Vikas Gaunekar (DW1), the Assistant Commissioner, who admitted that the Respondent were covered under the said Scheme. They point out that DW1 accepted that there was no reference to utilization certificate in the said Scheme and subsidies were reimbursed to several other theatres who too had not submitted any utilization certificates. They submit that in paragraph 24 of the plaint, the Respondent had given instances of cinema halls/theatres who were granted benefit under the said Scheme. They submit that this is a case of discrimination vis-a-vis the cinema halls/theatres referred to in paragraph 24 of the plaint. For all these reasons, Mr. Desai and Mr. Nadkarni submit that there is absolutely no case made out to warrant interference with the impugned judgments and decrees made by the learned District Judge in the two suits.

¶47

8 FA207&213-08

¶48

Mr. Desai and Mr. Nadkarni relied on Desh Bandhu Gupta and Co. and others Vs Delhi Stock Exchange Association Ltd¹ , Innamuri Gopalan and others Vs State of Andhra Pradesh and others² , Hansraj Gordhandas V/s H.H. Dave, Assistant Collector of Central Excise Customs, Surat and others³ , Mathuram Agrawal Vs State of Madhya Pradesh⁴ , G. P. Ceramics Private Limited Vs Commissioner, Trade Tax, Uttar Pradesh⁵ in support of their submissions.

¶49

The rival contentions now fall for determination.

¶50

Upon perusing the pleadings as well as the impugned judgments and decrees, the main point which arises for determination in these appeals is whether the multiplex theatres operated by the Respondents are covered under the said Scheme or not ?

¶51

In order to determine the aforesaid point, a reference has to be made to the entire text of the said Scheme, which came to be published in the Official Gazette, Extraordinary No. 3, Series I, No.32 dated 9^th November, 2004. The said Scheme reads thus :

¶52

1 (1979) 4 SCC 565

¶53

2 (1964) 2 SCR 888

¶54

3 AIR 1970 SC 755

¶55

4 (1999) 8 SCC 667

¶56

5 (2009) 2 SCC 90

¶57

9 FA207&213-08

¶58

GOVERNMENT OF GOA Department of Finance Revenue and Expenditure Division

Notification

3/2/2004-Fin(R&C)

The Goa Entertainment Tax based subsidy for Cinema Houses (Theatres) Scheme, 2004.

¶63

The Government of Goa is hereby pleased to frame a Scheme for granting Entertainment Tax based subsidy for cinema houses in the State of Goa, as follows, namely:-

¶64

Short title, commencement and duration.--(1) This Scheme be called The Goa Entertainment Tax Based Subsidy for Cinema Houses (Theatres) Scheme, 2004.

¶65

(2) It shall come into force with effect from 22.11.2004 and remain in force upto 21.11.2009.

¶66

2. Introduction.-The Entertainment Industry in the State of Goa is in bad shape and requires support from the Government by way of incentives and concessions. International Film Festival of India will be held in Goa commencing from 29.11.2004. In view of this International Film Festival, the public theatres are required to be upgraded to the required standard. Arrangement for granting interest free loan to Cinema Halls/ Theatres for their development and upgradation of their physical infrastructure is being made by the Government. A proposal for reimbursement of entertainment tax collected and paid by theatres as subsidy on 100% basis for a period of five years was also proposed by the Finance Minister in his Budget Speech for 2004-05. This Scheme is designed to achieve the above objects.

¶67

10 FA207&213-08

¶68

3. Objectives – The main objectives of the Scheme is to provide financial support to the existing cinema theatres for creating required infrastructure and also to assist them to repay interest free loan, if any, availed by them and to help them to continue their business.

¶69

4. Eligibility. - The Scheme is applicable to all the Cinema halls/theatres that are covered under the Goa Entertainment Tax Act, 1964 (Act 2 of 1964) until 21-11-2009 and having valid licence for exhibition under the Cinematograph Act, 1952 (Central Act 37 of 1952) and under the Goa, Daman and Diu Cinematograph Rules 1965. The benefit however will stop from 22-112009, irrespective of the amount and period of subsidy claimed by the applicant. Subsidy due upto 21-11-2009 will be however processed and disbursed after the expiry of the Scheme.

¶70

Quantum of subsidy.- (i) Subject to other provisions of this Scheme, the maximum subsidy admissible will be equal to entertainment tax actually paid by the Cinema hall/theatre in respect of entertainment provided by way of cinema shows for a period of 5(five) years, from the date of operation of the Scheme or for shorter period but not for any period beyond 21-11-2009.

¶71

(ii) The subsidy amount shall be restricted to the entertainment tax paid during the claim period. If any amount is defaulted or belatedly paid, it will not be taken into consideration for the purpose of computation of subsidy and such amount shall stand forfeited to the Government.

¶72

Mode of Payment. - The subsidy amount shall

¶73

11 FA207&213-08

¶74

be paid either in cash or by transferring the amount to financial institutions towards repayment of interest free loan granted to cinema theatres, as per the decision of Government and no claim in this regard shall be entertained.

¶75

Procedure for filing application and settlement of claim. - (1) The eligible Cinema theatre shall apply to the Commissioner of Entertainment Tax in the format appended hereto alongwith receipted copies of the challan, towards payment of entertainment tax made during the claim period. The claim period shall be quarterly and the application should be submitted to the commissioner within fifteen days from the end of the quarter to which claim relates. Separate application shall have to be made for every cinema theatre. The application for first claim period after the commencement of the Scheme, however, shall cover the period commencing from 22-11-2004 and ending with 31-3-2005. The application in this case should be filed on or before 15^th April, 2005. Delayed claim as well as payment not done shall not be added to the next claim and no claim shall lie in that respect.

¶76

(2) The Cinema theatre which avail interest free loan from financial institution shall have to file a declaration alongwith its application for claim of subsidy authorizing the Commissioner of Entertainment Tax to remit the amount of admissible subsidy to the financial institution for being adjusted towards repayment of the interest free loan availed till such loan is fully repaid.

¶77

(3) The Commissioner of Entertainment Tax shall be competent authority to entertain and sanction

¶78

12 FA207&213-08

¶79

subsidy claim in accordance with this Scheme. The Commissioner on being satisfied with the correctness of the claim shall make an order sanctioning the amount claimed which will be disbursed in accordance with Treasury Rules and scope of this Scheme.

¶80

Other Conditions – (1) No subsidy shall be admissible under this Scheme if licence granted to Cinema hall/theatre under the Cinematograph Act, 1952 (Central Act 37 of 1952) or under the Goa, Daman and Diu Cinematography Rules, 1966 by the competent authority, is cancelled or suspended for whatsoever reasons.

¶81

(2) Outstanding dues, if any, of the period prior to commencement of this Scheme towards entertainment tax, penalty, etc. shall be first recovered out of subsidy amount and the balance shall be made over to the cinema theatre or to the financing institutions, as the case may be.

¶82

Head of Account to which the expenditure will be debited – The expenditure towards disbursement of subsidy under this Scheme will be debited to the Budget Head 2045 – Other Taxes and duties on Commodities and Services 101 – Collection Charges – Entertainment Tax 01 – Office of the Commissioner of Sales Tax (Non Plan), 76 – Subsidies.

¶83

Amendment of the Scheme – The Government may, if it is so required, amend this Scheme.

¶84

11 . No inherent right shall arise out of this Scheme in favour of any person.

¶85

13 FA207&213-08

¶86

By order and in the name of the Governor of Goa, Shrikant M. Polle, Under Secretary (Fin. Exp.) Panaji, 8^th November, 2004.

¶87

( emphasis supplied )

¶88

Clause 2 of the said Scheme explains the background in which the said Scheme came to be formulated and notified. This clause states that the Entertainment Industry in the State of Goa was in a bad shape and required support from the Government by way of “incentives and concessions”. This clause then refers to the International Film Festival of India which was to be held in Goa shortly i.e. with effect from 29^th November, 2004. This clause then proceeds to state that on account of IFFI, the public theatres in the State of Goa were required to be upgraded to the required standard. The clause then refers to the arrangement for grant of interest free loan to such cinema halls/theatres for their development and upgradation of their physical infrastructure by the Government. The clause then makes reference to reimbursement of entertainment tax collected and paid by such theatres as a “subsidy” on 100% basis for a period of five years. Clause then states that the said Scheme is designed to achieve the said objects.

¶89

Clause 3 of the said Scheme refers to “Objectives”. This clause provides that the main objectives (SIC) of the Scheme is to provide financial support to the “existing cinema theatres for creating required infrastructure and also to assist them to repay

¶90

14 FA207&213-08

¶91

interest free loan, if any, availed by them and to help them to continue their business”.

¶92

This is followed by clause 4 styled as “Eligibility”. This clause states that the said Scheme is applicable to all cinema halls/theatres that are covered under the Goa Entertainment Tax Act, 1964 until 21^st November, 2009 and having valid licence for exhibition under the Cinematograph Act, 1952 and under the Goa, Daman and Diu Cinematograph Rules, 1965. This clause provides that the benefit however will stop from 22^nd November, 2009, irrespective of the amount and period of subsidy claimed by the applicant. Further, this clause provides that the subsidy due upto 21^st November, 2009 will be processed and disbursed after the expiry of the Scheme.

¶93

Clause 5 of the said Scheme adverts to “Quantum of Subsidy”, clause 6 refers to “Mode of Payment”, clause 7 refers to the “Procedure for filing application and settlement of claim”, clause 8 refers to “Other Conditions”, clause 9 refers to “Head of Account to which the expenditure will be debited”, clause 10 refers to “Amendment of the Scheme” and clause 10, which is of some significance provided that “no inherent right shall arise out of this Scheme in favour of any person”.

¶94

15 FA207&213-08

¶95

The Respondents/their representatives examined themselves as PW1 in their respective suits. Vikas Gaunekar, the Assistant Commissioner of Commercial Tax deposed on behalf of the Appellants as DW1 in each of the two suits.

¶96

According to us, in a matter of this nature nothing much turns on the deposition of the parties. This is because, in the present matters, we are basically concerned with interpretation of the clauses of the said Scheme. This is an exercise which will have to be necessarily undertaken by the Court. No doubt, in case of ambiguity external aids to interpretation can always be looked into. However, any opinion expressed by either the representatives of the Appellants or the representatives of the Respondents is not really determinative in such matters. If upon a proper interpretation of the said Scheme, any party is indeed covered under the said Scheme, then, any assertion to the contrary by any witness, will make no much difference. Similarly, if any party is not covered under the said Scheme, then, again any assertion to the contrary or for that matter even any admission made by witness, will make no real difference on the issue of interpretation of the provisions of the said Scheme. Therefore, we agree with Mr. Faldessai that the learned District Judge was not right in overemphasizing upon some of the statements made by DW1, in his deposition before the Court.

¶97

16 FA207&213-08

¶98

In any case, we have perused the testimony of DW1. DW1, at one stage, did say that the multiplexes put up by the Respondents fulfilled the eligibility criteria prescribed under clause 4 of the said Scheme. However, he immediately added that nevertheless, the Respondents were not covered under the said Scheme because the said Scheme was intended to apply only to existing theatres/cinema halls which were in a bad shape and whom, the State wanted to provide incentives, in order to upgrade themselves. The learned District Judge obviously was not right in adverting to only one part of the testimony of DW1 and ignoring the later. Even otherwise, the testimony had to be read and construed in its entirety and not by reading a sentence or two, quite out of context.

¶99

The said Scheme has to be read and construed in its entirety. Clauses of the said Scheme have to be read and construed in harmony with one another. Overemphasis on clause 4 of the said Scheme must not be at the cost of entire structure of the said Scheme or for that matter at the cost of clauses 2 and 3 of the said Scheme which explain the precise purpose for which the said Scheme was formulated in the first place. This manner of reading clause 4 of the said Scheme, will possibly frustrate the entire purpose and objectives of the said Scheme not to mention that same will unjustly enrich the Respondents in the present case.

¶100

17 FA207&213-08

¶101

Though, clause 4 of the said Scheme is styled as “Eligibility” that by itself, does not mean that every cinema hall/theatre will cover under the Goa Entertainment Tax Act, 1964, is automatically entitled to subsidy by way of 100% reimbursement of entertainment tax for a period of five years. Actually, clause 4 of the said Scheme states, what is obvious. Unless and until a cinema hall/theatre is covered under the Goa Entertainment Tax Act, 1964, there would arise no question of such cinema hall/theatre paying the entertainment tax to the Government, under the said Act. Similarly, if a cinema hall/theatre was never liable to pay the entertainment tax to the Government under the Goa Entertainment Tax Act, 1964, then, there would arise no question of such cinema hall/theatre claiming any “reimbursement” as such. This is because the concept of “reimbursement” itself contemplate that the party must have actually paid the amount first, in order to claim “reimbursement”.

¶102

Therefore, in the peculiar facts of the present case, it may not be correct to say that the moment in cinema hall/theatre is covered under the provisions of Goa Entertainment Tax Act, 1964, then, without anything more such cinema hall/theatre is entitled to benefit under the said Scheme. According to us, the said Scheme has to be read and construed in its entirety. Clauses of the Scheme including in particular the Scheme in clauses 2, 3 and 4 have to be construed harmoniously. If exclusive focus is on clause 4, then, the

¶103

18 FA207&213-08

¶104

same will virtually render the provisions in clauses 2 and 3 quite redundant or otiose.

¶105

Most of the rulings referred to by the learned counsel for the Respondents apply to a situation where the provisions of statute are extremely clear and admit of no ambiguity whatsoever. It is in this situation the Supreme Court has held that the rule of literal construction must be adopted. The intention of the Legislature as expressed in words employed of the Legislature must be respected.

¶106

Some of the judgments referred to application of doctrine of contemporanea expositio, if, any ambiguity arises in the interpretation of the statutes, particularly old statutes. In the present case, we cannot say that the provisions of clause 4 of the said Scheme are clear and unambiguous. As noted earlier, overemphasis on clause 4 of the said Scheme has a tendency to render clauses 2 and 3 of the said Scheme redundant and otiose. The literal interpretation suggested by the Respondents, is likely, to not only frustrate the objectives and purpose of the said Scheme, but further, unjustly enrich the Respondents. To such a situation, the rulings relied upon by the Respondents do not apply.

¶107

Reference is however necessary to the ruling of the

¶108

19 FA207&213-08

¶109

Supreme Court in U.P. Bhoodan Yagna Samiti, U.P. Vs Braj Kishore and others⁶ . In this case, the Supreme Court was concerned with the allotment of land in favour of “landless persons”. Such allotment was in fact made in favour of the Respondents before the Supreme Court, who were affluent businessmen residing and owning property in the city of Kanpur. The Additional Collector, subsequently revoked such allotment but the Allahabad High Court, restored such allotment on the basis of literal interpretation of the expression “landless persons”. The Allahabad High Court reasoned that since the Respondents did not own agricultural land in the villages, they were “landless persons” as defined under the said Act.

¶110

The Supreme Court reversed the Allahabad High Court and held that resort to literal interpretation in such circumstances was not proper, as otherwise the basic objectives of the Scheme formulated by the said Act for allotment of agricultural land to the landless persons involved in agriculture, would be totally frustrated.

¶111

The Supreme Court, for the purpose of interpretation referred to the following Shloka :

¶112

"Upkramop Sanharo Abhyaso Uppurwatta Falam Arthwadoppatti Ch Lingam Tatparya Nirnaye”

¶113

6 (1988) 4 SCC 274

¶114

20 FA207&213-08

¶115

The Supreme Court, in paragraph 13 explained that this in short means that when you have to draw the conclusion from a writing you have to read it from beginning till end. As without doing it, it is difficult to understand the purpose, if there is any repetition or emphasis its meaning must be understood. If there is any curiosity or a curious problem tackled it should be noticed and the result thereof must be understood. If there is any new innovation (Uppurwatta) or something new it should be taken note of. Then one must notice the result of such innovation. Then it is necessary to find what the author intends to convey and in what context.

¶116

The Supreme Court at paragraph 14 further explained that this principle of interpretation was not enunciated only for interpretation of law but it was enunciated for interpreting any piece of literature and it meant that when you have to give meaning to anything in writing then you must understand the real meaning. You can only understand the real meaning by understanding the reference, context, the circumstances in which it was stated and the problems or the situations which were intended to be met by what was said and it is only when you take into consideration all this background, circumstances and the problems which have to be tackled that you could really understand the real meaning of the words. This exactly is the principle which deserves to be considered.

¶117

21 FA207&213-08

¶118

Finally, the Supreme Court, referred to passages from book “The Discipline of Law” written by Lord Denning, in order to interpret the expression “landless persons”. The Supreme Court noted that the judge believing himself to be fettered by the supposed rule that he must look to the language and nothing else, laments that the draftsmen have not provided for this or that, or have been guilty of some or other ambiguity. It would certainly save the judges trouble if Acts of Parliament were drafted with divine prescience and perfect clarity. In the absence of it, when a defect appears a judge cannot simply fold his hands and blame the draftsmen. He must set to work on the constructive task of finding the intention of Parliament and it is clear that when one has to look to the intention of the Legislature, one has to look to the circumstances under which the law was enacted. The Preamble of the law, the mischief which was intended to be remedied by the enactment of the statute. The Supreme Court, by quoting Lord Denning, observed that at one time the Judges used to limit themselves to the bare reading of the Statute itself to go simply by the words, giving them their grammatical meaning and that was all. That view was prevalent in the l9th century and still has some supporters today. But it is wrong in principle. So therefore, it has been held very rightly that you can inquire into the mischief which gave rise to the Statute, to see what was the evil which it was sought to remedy.

¶119

22 FA207&213-08

¶120

On the basis of aforesaid authority of the Supreme Court, we are satisfied that the said Scheme will have to be construed in its entirety. Clauses of the Scheme will have to be read and construed in harmony with one another. Overemphasis on clause 4 of the said Scheme alone, will not be proper. Thus, construed, it is quite clear that the said Scheme was formulated to assist the existing cinema halls/theatres which were in bad shape and which required Government support by way of “incentives and concessions” in order to upgrade themselves upto the required standard for IFFI which was to commence shortly. The Scheme was not formulated to give a bonanza to brand new multiplexes equipped with all upgraded facilities.

¶121

The existing cinema halls/theatres, on account of their ticket rates and other factors were unable to make significant investment at upgradation. Such upgradation was necessary on account of IFFI. Therefore, the Government, by formulating the said Scheme offered incentives and concessions to such old cinema halls/theatres which were in a bad shape. The position of brand new multiplexes set up or operated by the Respondents was entirely different. They not only had upgraded infrastructure and facilities, but further, they were charging proportionately higher fees to their consumers. The said Scheme was obviously not formulated to extend any assistance to such brand new multiplexes.

¶122

23 FA207&213-08

¶123

The position of ILL, is quite peculiar. The multiplex theatre was being operated by them under a leave and licence agreement dated 17^th November, 2006 with the Entertainment Society of Goa, which Mr. Faldessai says was an agency and instrumentality of the State Government. This multiplex theatre was constructed by this agency on Government land. To extend benefit of the said Scheme to ILL, would amount to award of bonanza in favour of ILL and unjustly enrich the ILL at the cost of public exchequer.

¶124

Although, PKK may have itself constructed the Osia Multiplex, nevertheless, such a multiplex was constructed and opened a few days prior to IFFI. The multiplex was equipped with all facilities and infrastructure necessary for IFFI. According to us, even such a multiplex was not in contemplation of the said Scheme and the learned District Judge erred in extending such benefit under the said Scheme to such multiplex, overemphasizing on clause 4 of the said Scheme and thereby ignoring the other clauses of the said Scheme.

¶125

Based upon certain notings in the file or even endorsement made by the Chief Minister, there is no question of interpreting the said Scheme so as to frustrate its objectives. On one hand, the Respondents urge that there is no ambiguity in the said

¶126

24 FA207&213-08

¶127

Scheme and on the other hand, the Respondents seek to invoke the doctrine of contemporanea expositio, on the basis that there is some ambiguity in the said Scheme. According to us, even the application of doctrine of contemporanea expositio would oblige us to look into the notings or observations in the file, in their entirety.

¶128

The notings/observations, in the first place are not at all clear and themselves liable to interpretation. That apart, once there is formulated and notified Scheme, its interpretation will have to be on the basis of such formulated and notified Scheme to be read and construed in its entirety in preference to notings or observations in the file. According to us, upon harmonious construction of clauses 2, 3 and 4 of the said Scheme, we cannot say that brand new multiplexes already having the upgraded facilities were not also to be covered under the said Scheme.

¶129

The notings of the Chief Minister perhaps suggest that the said Scheme is not restricted only to cinema halls/theatres which may also include the multiplexes. Notings however cannot be interpreted or construction to mean that the said Scheme was to extend even to brand new multiplexes with upgraded facilities. Notings/observations cannot be construed to mean that the multiplexes constructed on the Government land by agency of the Government should also be eligible for benefit under the said

¶130

25 FA207&213-08

¶131

Scheme.

¶132

The learned District Judge in the present case has completely ignored the clause 11 of the said Scheme, which, in terms, provides that no inherent right shall arise out of the said Scheme in favour of any person. Notwithstanding such clause, it is possible to say that some person could have insisted upon enforcement of the said Scheme by invoking doctrine of promissory estoppel. However in the present case, neither the Respondents have pleaded promissory estoppel nor do there exist any circumstance justifying invocation of the doctrine of promissory estoppel.

¶133

The Respondents, have pleaded discrimination by referring to theatres like Samrat theatre, Ashok theatre, Cine National, Cine Vishant, Cine Lata, Shivam theatre, Hira Talkies, Cine Alankar, Cine Niagara, Cine Paradise, Cine Aisha, Cine ElMonte, Nandi Theatre, Cine Chitra Mandir, Cine Anandi and Cine Radhakrishna who they claimed, were granted benefit under the said Scheme.

¶134

Now, the Respondents have not made out any case that all these theatres were brand new theatres or multiplexes already having upgraded facilities. In fact, there does not appear to be any serious dispute that all these theatres were old theatres which were in

¶135

FA207&213-08

¶136

bad shape and which required upgradation on account of IFFI. It is precisely these theatres which were intended to be covered under the said Scheme. Therefore, there is no really case of discrimination as such made out by the Respondents. The principle of equality has to be adopted amongst equals.

¶137

For all the aforesaid reasons, we allow both these appeals, set aside the impugned judgments and decrees dated 30^th April, 2008 in Civil Suit Nos.33/2007 and 57/2007 and dismiss the said Civil Suits without any order as to costs.

¶138

The record indicates that the Appellants had deposited the entire decretal amount in this Court and thereafter, on the motion of the the Respondents, the Respondents were permitted to withdraw a portion of such deposit amount subject to furnishing bank guarantees from the nationalized bank and giving undertakings that in case these appeals are allowed, the Respondents will bring back the withdrawn amount with interest at the rate of 10% per annum within a period of one month from the date of disposal of these appeals.

¶139

Now that we have allowed these appeals, we direct the Respondents, consistent with their undertakings to bring back the amount withdrawn by them together with interest at the rate of

¶140

27 FA207&213-08

¶141

10% per annum thereon, within a period of four weeks from today. In case this is not done, the Appellants without prejudice to their rights to take out appropriate proceedings for breach of undertakings, will be entitled to invoke the bank guarantees and recover the withdrawn amount together with interest.

¶142

These appeals are disposed of in the aforesaid terms. Necessary decree to be drawn in the matter. There shall be however no order as to costs.

¶143

Prithviraj K. Chavan, J. M. S. Sonak, J.

¶144

at*

The State of Goa through Chief Secretary and Anr., v. Mr. Prakash K. Kothari Proprietor of M/S Osia Multiplex

Case brief

What is this about?

What did the court decide?

The State of Goa through Chief Secretary and Anr., v. Mr. Prakash K. Kothari Proprietor of M/S Osia Multiplex

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Sheila Prakash Kavlekar and Anr., Vs Ravindra Tulsidas Deulkar and 8 Ors.

The Director of Fisheries, Directorate of Fisheries, Thr. Its Director, Vinesh Arlenkar., Vs Gokuldas Phadte.

Rajendra Singh @ Rajendra Singh Dholi, Presently at Central Jail Colvale, Thr. Jose R. a. Rodrigues Vs the Superintendent, Office of the Superintendent, Central Jail Colvale.

The State of Goa through Chief Secretary and Anr., Vs Inox Leisure Limited through Asst Manager (Legal) Amit Karle

Jagannath P. Shirodkar Vs State of Goa

Meenakshi v. Naik., Vs State of Goa, Thr. Chief Secretary, Govt. of Goa and 4 Ors.