State-fixed Cinema ticket caps do not absolve it of liability for not passing on GST rate reduction benefits to consumers

Last updated: 31 December 2025

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The GST Appellate Tribunal has ruled that cinema halls cannot use state-imposed maximum ticket prices as an excuse for not passing on Goods and Services Tax (GST) rate reductions to consumers. The tribunal affirmed that any reduction in GST rates must be reflected in lower ticket prices for the public. Furthermore, the ruling clarified that 'maintenance charges' are part of the taxable value and cannot be used to offset the GST benefit. The cinema was ordered to deposit the profiteered amount with interest.

Court :
GSTAT Delhi

Brief :
The GST Appellate Tribunal Delhi in the case of DGAP v. Mallikarjuna Cinema Hall, 70MM Hyderabad [NAPA/3/PB/2025, order dated September 12, 2025] held that the respondent cinema's reliance on state-fixed ticket caps does not absolve it of liability for not passing on GST rate reduction benefits to consumers, reaffirming that maintenance charges are also part of the taxable value. Profiteered sums and limited interest were directed to be deposited as per law.

Citation :
NAPA/3/PB/2025, order dated September 12, 2025

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1 Year PLAN - Rs.~~1999~~

1799

(Excl. of GST ₹323)

2 Years PLAN - Rs.~~3499~~

3149

(Excl. of GST ₹566)

BEST VALUE

3 Years PLAN - Rs.~~4999~~

4499

(Excl. of GST ₹809)

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Judgement posted by

Bimal Jain

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FCA, FCS LLB with21 Yrs of Experience inTaxation Indirect and Direct: Education Qualification: B.Com (Hons) Chartered Accountants Company Secretary LLB Qualified SAP FI/CO Consultants Professional Membership: Chairmanof Indirect Tax Committee of PHD Chamber of Commerce Member of Indirec ... Read more

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