The Karnataka High Court on Wednesday sought the state government’s response to a petition challenging the levy of a 2% cess on cinema tickets under the Karnataka Cine and Cultural Activists (Welfare) Act, 2024.
Justice H T Narendra Prasad issued notice to the state on a writ petition filed by the Multiplex Association of India (MAI) and PVR INOX.
The petition challenges the enforcement of the 2024 Act, the Karnataka Cine and Cultural Activists Social Security and Welfare Rules, 2025, the 2026 amendment to the Act, and various notifications, office orders and enforcement notices issued by the state Labour department.
The dispute centres on the state government’s August 29 circular directing cinema theatres and multiplexes across Karnataka to collect an additional 2% on cinema ticket prices from September 1.
The petitioners have argued that the government cannot enforce the cess through circulars, office orders or notices when the parent legislation has not yet been brought into force.
Section 1(2) of the 2024 Act provides that it will come into effect on a date appointed by the government through a notification in the gazette. The petitioners’ counsel questioned how authorities could demand payment of the cess when no such notification had been issued.
The Act provides for a cess on cinema revenues and revenues of “related establishments” to fund welfare measures for cine and cultural activists.
The petitioners also questioned the merits of the levy saying the Parliament has already enacted the Code on Social Security, 2020, which covers social security and welfare of workers, including cine and cultural workers.
The court indicated that it would examine the finer legal issues after determining whether the Act itself had come into force and posted the case for hearing on Thursday.
