Karnataka HC quashes 2% cinema cess order, says law not yet in force

Bengaluru: The Karnataka High Court on Thursday quashed the state government’s order mandating cinema theatres and multiplexes to collect a 2% cess on ticket prices, noting that the law under which the levy was imposed had not yet come into force.

Justice HT Narendra Prasad recorded the government’s submission that the Labour Department had withdrawn its September 9 office order directing collection of the cess. The government also acknowledged that the Karnataka Cine and Cultural Activities (Welfare) Act, 2024 had not been notified in the official gazette for commencement.

The court had on Wednesday sought the government’s response to a writ petition filed by the Multiplex Association of India (MAI) and PVR INOX challenging the levy.


The government had on August 29 issued a circular directing cinema theatres and multiplexes across Karnataka to collect an additional 2% of the ticket price from September 1.

The petitioners argued that the state could not enforce the cess through circulars or office orders when the parent legislation had not been brought into force.

The 2024 Act provides for a cess on cinema revenues and revenues of “related establishments” to fund welfare measures for cine and cultural workers.

The petitioners also questioned the levy considering the Code on Social Security, 2020, which provides for social security and welfare measures for workers, including those in the cine and cultural sectors.