Supreme Court Upholds States’ Power to Levy Entertainment Tax on DTH, Cable Services

The Supreme Court has upheld the constitutional validity of the entertainment tax levied by States on cable and Direct-to-Home (DTH) television services.

The court ruled that States can tax the entertainment aspect of DTH services, even if the broadcasting function is taxed by the Centre.

The Court applied the "aspect theory" to hold that a single activity may attract both service tax and entertainment tax from different governments.

The court dismissed appeals by Tata Play, Dish TV, and others, and allowed Kerala’s appeal challenging a 2012 judgment, thereby validating entertainment tax laws across several States, including Uttar Pradesh, Rajasthan, and Gujarat.