In a major relief to multiplex giants like PVR and BookMyShow, the Bombay High Court has struck down Maharashtra government orders that barred cinemas from charging convenience fees on online ticket bookings.
A Division Bench of Justice MS Sonak and Justice Jitendra Jain ruled that the State has no authority under the Maharashtra Entertainment Duty Act (MED Act) to prohibit the collection of such fees. The Court said the restriction violated the fundamental right to carry on trade or business under Article 19(1)(g) of the Constitution.
“Suppose the customer feels it convenient to book the tickets online by not going to the theatre and paying the convenience fees. In that case, the respondents cannot restrain the petitioners from collecting the convenience fees,” the Court observed.
The judgment came in petitions filed by PVR Ltd., BookMyShow (Big Tree Entertainment Pvt Ltd), and other cinema operators, who challenged two State government orders from 2013 and 2014. These orders directed multiplexes not to collect any amount above the ticket price and applicable entertainment duty.
The petitioners argued that convenience fees are part of a private contractual arrangement—covering online platform costs like payment gateways and customer support—and not subject to regulation under the MED Act. The State countered that such charges were unauthorized and not accounted for under entertainment tax.
However, the Court rejected the State’s argument, holding that:
“We could not find any power in the Act, which permits the Respondents to issue G.O.s prohibiting collection of convenience fees on online ticket booking.”
It further ruled that executive power under Article 162 cannot be exercised in a legislative vacuum and any such order must be traceable to a valid law.
“If business owners are not permitted to determine the various facets of their business (in accordance with law), economic activity would come to a grinding halt,” the Bench noted.
Importantly, the Court clarified that its ruling does not settle whether entertainment duty is payable on convenience fees, leaving that question open.
Legal Representation
PVR was represented by Advocate Naresh Thacker with Advocate Shweta Rajan (ELP).
FICCI-Multiplex Association of India was represented by Advocates Naresh Thacker, Chakrapani Misra, Sameer Bindra, and Ananya Misra (Khaitan & Co).
BookMyShow was represented by Advocate Rohan Rajadhyaksha, Dhirajkumar Totala, and Tejas Raghav (AZB & Partners).
The State of Maharashtra was represented by Additional Government Pleader Milind More.
Case: PVR Ltd and Ors vs State of Maharashtra – Available on LAWFYI.IO
