On writ petitions by hotels contending that the Expenditure Tax Act, 1987 did not apply to them because the room charges for any unit of residential accommodation at their hotels are fixed on “double occupancy basis” and though room charges per se may appear to exceed Rs. 1,200 per day, having due regard to the expression “per individual” appearing in section 3(1) of the Act, such room charges had to be “divided into two” the High Court dismissed the petitions, holding against the assessees on the questions whether in view of the express provisions of section 3 of the Expenditure Tax Act, 1987 Expenditure-tax would be chargeable where the room charges were less than Rs. 1,200 and whether an exemption under section 4 of the Expenditure-tax Act, 1987 was allowable. On petitions for special leave to appeal to the Supreme Court. SLP of assessee is dismissed. (AY.1996-97)
Fomento Resorts and Hotels Ltd. v. ACIT (2023)452 ITR 248 (SC) Editorial: SLP of the assessee is dismissed, Fomento Resorts and Hotels Ltd. v. ACIT ( T.A. No. 64 of 2007 dt 30 -8 -2019 ( Bom)( HC )
Expenditure Tax Act, 1987
S. 2(6): Hotel – Dual occupancy room in Hotels — Expenditure-Tax chargeable where room charges “Per Individual” Less than Rs. 1,200 — Exemption not allowable .[ S. 2(8),2(10) , 3 , 4(a) , Art 136 ]