State government devises a new definition soft music + alcohol = pub

The district entertainment duty office has sent notices to 68 ‘pubs’ in the city asking them to pay entertainment tax after the state government reached a consensus on the definition of the word pub. The state government had passed a General Resolution (GR) in 2010, according to which permit rooms/beer bars with live orchestras and pubs have to mandatory pay entertainment tax.

Representation Pic/Krunal Gosavi

But with the confusion regarding the definition of a pub reigning supreme, the district entertainment department was a confused lot. However, after an amendment was made to the Bombay Entertainment Duty Act 1923, the state cleared the confusion on the word ‘pub’, classifying all establishments serving liquor and playing music as a ‘pub’.

What the pub!
This means any restaurant serving alcohol and playing classical, soothing or recorded music is bound to pay the entertainment tax. For instance, a restaurant serving liquor and playing soothing music in the background would now have to pay the entertainment tax. “We have been sending the notices to various permit rooms and pubs to pay the entertainment tax since the last one year. However, we were confused over the concept of ‘pub’.

But after the state government added the concept of the word ‘pub’ by amending the Bombay Entertainment Duty Act 1923, we have, in the past 15 days, sent notices to 68 pubs and permit rooms out of 90 in the city asking them to immediately pay the entertainment tax,” said District Entertainment Duty Office in-charge and Tehsildar Geetanjali Shirke.

She added that seven teams have been formed to send notices to various pubs and permit rooms in the city, further adding that it was not her office’s decision to charge the entertainment duty, but it was state government’s decision. “If the pub or permit room owners do not pay the duty, strict action would be taken against them,” said Shirke.

Furore over diktat
Prominent restaurant owners and socialites in the city have reacted sharply to the issue, and are saying it’s nothing but a new way by the state government to harass hotel owners. Socialite Tehseen Poonawala said that such practices by state government would discourage hotel owners from establishing businesses in the city.

Taxing law: According to the GR, even a restaurant that serves liquor and plays soothing music in the background will now have to pay the entertainment tax. Representation Pic/Krunal Gosavi

“How is it justifiable to charge such a huge amount as an entertainment duty, if any pub or permit room plays background music, which would be classical in nature?” questioned Poonawala. Mukesh Talwar, owner of restaurant Chinese Room at Karve Road, said that, on Monday, a team from the district collectorate approached his hotel with the notice. However, as the restaurant was closed, the team returned back.

“I have a permit room with 22 tables and we play soft music in the background to please customers. However, we have now stopped playing music since the past 15 days, as we got to know of the exorbitant charge,” said Talwar. Sarovar Restaurant located in Deccan Gymkhana area also got the notice from district entertainment duty office around four days back. “It’s totally unfair to levy such a huge amount every month as entertainment duty when we only play radio stations at our hotel while serving liquor, said owner of Sarovar Restaurant, Pramod Koti.

Fight for what’s right
Meanwhile, President of Restaurant and Hotelier’s Association, Ganesh Shetty, claimed that it wasn’t mentioned anywhere in the GR about the concept of the word ‘pub’. “It is being allegedly created by the entertainment duty office to levy tax from pubs and permit room owners,” said Shetty. “We made our grievances known to our association in Mumbai, and it has promised to take this issue to the higher level,” he added.

Socialite Monica Trivedi said that the state government’s concept of pub is totally wrong and pub is something where one can go to relax. “It’s not necessary that every pub plays music. Customers might suffer due the state government’s decision to levy the duty, as these restaurants are most likely to increase prices of food items and liquor,” said Trivedi.

Tax slab
>> According to the GR, each permit room within PMC limits will have to pay Rs 50,000 per month as an entertainment duty.

>> Permit rooms outside PMC limits should pay Rs 25,000. 

>> Pubs situated in five-star hotels would have to pay Rs 1 lakh.

>> Pubs outside five-star hotels would have to shell out Rs 50,000 per month.  

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