THROUGH the common judgement of three writ petitions delivered by Bombay High Court division bench consisting of Justice M S Sonak and Justice Jitendra Jain on July 10, 2025, At Mumbai, these petitions have been allowed by declaring clause(a)and clause 3(d) of G O dated April 4, 2013 as unconstitutional to the extent it prohibits collection of convenience fees /service charges on online ticket booking. The interim orders granted have been now made absolute.

 

These petitions have been filed by PVR Ltd. New Delhi, FICCI-Multiplex Association of India¸ its Secretary, Dnyandas Damodar Chaphalkar, Pune and Big Tree Entertainment Pvt. Ltd. and its Director, Rajesh Balpande, against respondents – State Revenue, Revenue Commissioner, Mumbai, and Forests Secretary and Two Collectors at Bandra(East) and Fort, Mumbai. Rule and interim relief was granted on July 9, 2014 staying the operation and implementation of paragraph 3 (d) of the two Government Orders (GOs) issued by the State Revenue and Forest Department, which prohibited the collection of service charges/convenience fees on booking of computerised cinema tickets online. The petitioner is engaged in the business of operating and managing multiplex cinemas in India, including in the State of Maharashtra. On April 4, 2013, the impugned G O was issued ordering that no exhibitor, owner or agent should charge or recover any additional amount from viewers for online computerised ticket sales.

 

The said clause (d) of the G O reads:“(d) At the time of selling the tickets in the cinema theatres through online computerised system, the operator, owner also the agent shall not charge any additional service charge. For this purpose, operator/ owner of the theatres shall not recover the amount due and payable to the appointed agency”. On March 18, 2014, another G O was issued, which is also impugned in the present petition. It is stated that all the theatre conductors should set up their own service machinery for online sale within a period of four weeks from the date of the order issued by the High Court in Public Interest Litigation (PIL) No. 66/2013. However, it was stated that, when making tickets available through this machinery, no additional service charges should be recovered from the viewers. The said clause (a) of the Government Order issued on March 18, 2014 reads as under: “(a) All Cinema theatre Operators across the State shall set up their own service/system for online sale of tickets within a period of four weeks, that is up to the date of April 1, 2014 from the date of passing of the order, that is, March 4, 2014, by the HC and while making the tickets available through this system, no additional service charges shall be recovered from the viewers.” These two impugned clauses have been challenged through this petition.

 

On December 29, 2014, section 2(b) of the Maharashtra Entertainment Duty Act, 1923 (formerly Bombay Entertainment Duty Act), which defines “payment for admission” was amended and a proviso was inserted which provided that service charges for providing facility of online ticket booking shall be included in the ”payment for admission”. The HC has stated that issue before it was not whether entertainment duty on convenience fees should be levied or not, but the issue before the Court is whether the respondents by issuing impugned G O can prohibit the petitioners from collecting the convenience fees. Therefore, the HC is of the view that the impugned G O transgressed the fundamental rights under Article 19(1)(g) granted to the petitioners by prohibiting theatre owners and others from collecting the convenience fees from their customers. In absence of a statutory regulation regulating the right to conduct the business of the petitioner, the imposition of such a restraint would infringe legitimate rights of theatre owners. The impugned prohibition is contrary to Article 19(1)(g) of the Constitution of India. If business owners are not permitted to determine the various facet of their business (in accordance with law) economic activity would come to a grinding halt.

 

The choice of whether to book the ticket online or purchase it at the theatre is left to the customers. In case, when the customer feels it convenient to book the tickets online by not going to the theatre and paying the convenience fees, the respondents cannot restrain the petitioners from collecting the convenience fee, since for providing this facility of online booking, the theatre owners/petitioners have to invest in technology. The HC has made it clear that it is not deciding whether an entertainment duty is liable to be paid on such convenience fees. Because of this, the impugned clause 3(d) of the G O dated April 4, 2013 and clause (a) of G.O. dated March 18, 2014 have been quashed and set aside. The present petition concerns only the period prior to December 29, 2014 and empowerment of the respondents for issuing GOs to the extent of prohibition to collect the convenience fees. In the opinion of the HC, it is not open to the State Government to issue directions, in respect of commercial or economic aspects of legitimate subsisting contracts /transactions between two private parties with which the State has no direct casual connection, in the guise of management of pandemic situation or to provide “mitigation to one” of the two private parties “at the cost of the other”. This is akin to rob Peter to Paul.

 

This is a different matter, if as a policy, the State Government takes the matter, if as a policy, the State Government takes the responsibility to subsidise the school fees of students of private unaided schools, but cannot arrogate the power to itself much less under Article 162 of the Constitution to issue impugned directions (to school management to reduced school fees for the concerned academic year). The HC has stated that it has no hesitation in observing that the observation of the State Government of existence of power to issue directions even in respect of economic aspects of legitimate subsisting contracts/transactions between two private parties, if accepted in respect of fee structure of private unaided schools is fraught with undefined infinite risk and uncertainty for the State. For, applying the same logic and the State Government may have to assuage similar concerns in respect of other contractual matters between two private individuals in every aspect of life, which may have bearing on right to life guaranteed under the Constitution. That would open not only pandora’s box, but will also push the State Government to entertain demands including to grant subsidy from different quarters and sections of Society.