ON MAY 22, 2025, THE SUPREME COURT OF INDIA gave an important decision about whether both the Centre and the States can tax television broadcasting used for entertainment. The case raised the question of ‘dual taxation’—whether two different taxes on the same activity are allowed under the Constitution.
The bench of Justices B.V. Nagarathna and N. Kotiswar Singh held that both the Centre and the States can tax different parts of the same activity without breaking the law. The Court explained that the Centre can impose a service tax on the act of broadcasting (like providing channels and content), because it is a type of service. The State can impose an entertainment tax on the enjoyment of that broadcast (like watching shows at home), because it is a form of entertainment or luxury. The Court clarified that this is not illegal double taxation because the two taxes apply to different aspects of the same activity. Broadcasting and entertainment are treated as separate subjects in the Constitution and can be taxed by different governments.
This judgment carries significant constitutional and fiscal implications. It resolves long-standing ambiguity over whether such simultaneous taxation amounts to legislative overreach or violates the principle of double taxation. Additionally, the Court’s liberal interpretation of "entertainment" reflects the evolving nature of digital consumption in private and personalised spaces, extending the scope of entertainment tax beyond traditional forms.
The aim of this article is to critically examine the Supreme Court's ruling on the bifurcated taxation of broadcasting for entertainment purposes. It seeks to clarify the constitutional framework that permits both the Centre and the States to levy taxes on different facets of the same activity and analyze the reasoning adopted by the Court in interpreting Entries 62 and 97 of the Seventh Schedule. Lastly this article will evaluate the implications of this judgment on the broader issues of federal taxation powers and technological advancements in media consumption.
