SC Stays Levy Of Stamp Duty On ‘Advertisement’ Contracts [Read Order]
The matter requires to be debated, especially keeping in view the sacrosanctity of the freedom of speech and expression and the involvement of electronic and print media, the Bench said.
The Supreme Court has stayed Bombay High Court judgment which had dismissed the challenge against levy of stamp duty on contracts entered into by advertising agencies with their clients and with media companies.
Senior advocate Arvind P Datar, appearing for Indian Broadcasting Foundation, submitted before the court that the state legislature could not impose tax on anything shown on electronic and print media.
“If huge revenue is taken away from the members of the Broadcasting Foundation, who are embedded to the cause of freedom of speech and expression that percolates the ethos pertaining to individual and collective expression, it inevitably hampers the freedom of speech and expression. That is not constitutionally permissible,” he told the court.
The state, through senior advocate KK Venugopal, told the court that levy of stamp duty had nothing to do with the concepts of freedom of speech and expression. He also contended a state legislature can legislate touching upon the aspects of stamp duty for the purpose of revenue generation and it cannot be called a colorable exercise of power.
Hearing rival submissions, the bench headed by Justice Dipak Misra observed: “The matter requires to be debated, especially keeping in view the sacrosanctity of the freedom of speech and expression and the involvement of electronic and print media.”
The court stayed the operation of Bombay High Court judgment, subject to these conditions:
- Member of the foundation keeps accounts with itself and giving at least samples of 10 agreements to the state.
- Each member of the foundation shall give a summary of the revenue earned through the advertisement.
The court then posted the matter for final hearing on September 13.
Read the Order here.