Inside Bombay High Court Ruling on convenience fees on online Movie ticket bookings

In a writ petition, PVR Ltd. contested two Government Orders (GOs) issued by the Government of Maharashtra, which barred the collection of service or convenience fees on online bookings for cinema tickets. The petitioner, a major cinema operator, argued that these GOs violated their constitutional right to conduct business under Article 19(1)(g) and lacked legal support under the Maharashtra Entertainment Duty Act, 1923 (MED Act). Inside Bombay High Court Ruling on convenience fees on online Movie ticket bookings the court struck down government orders that banned theatre owners from charging convenience fees, ruling that such restrictions violated the right to do business and lacked legal backing.

Background

The first GO, issued on April 4, 2013, prohibited exhibitors from charging viewers additional fees for online ticket sales. The second GO, dated March 18, 2014, directed cinema owners to establish their own online ticketing systems but similarly disallowed them from levying any extra service charge.

PVR Ltd. challenged these orders, asserting that they interfered with the freedom to contract and imposed unreasonable limitations on private business dealings. The petitioner also questioned the legal foundation of the GOs, pointing out that the MED Act did not confer such regulatory powers on the government. In support of its stance, the petitioner cited Article 14, arguing that this restriction created an unfair distinction between Maharashtra and other states.

In response, the government relied on Article 162 of the Constitution and various provisions of the MED Act, such as Sections 3(3)(e), 4(2)(b), and 2(b).

Court’s Analysis

The High Court, led by Justices M.S. Sonak and Jitendra Jain, examined whether the government had authority under the MED Act to prohibit such charges, and whether the GOs were constitutionally valid.

On analyzing the provisions of the MED Act, the Court found that its primary focus was the collection of entertainment tax—not the regulation of private service charges or pricing between cinemas and consumers. The Court clarified that Sections 3 and 4 pertained only to duty collection and did not empower the State to intervene in commercial transactions such as convenience fees.

Moreover, the amendment to Section 2(b) in 2014, which included service charges in the definition of "payment for admission," did not retroactively validate the GOs.

In terms of constitutional rights, the Court held that the GOs infringed on the petitioner’s right to carry on business, as they dictated terms between two private entities without backing from a law duly enacted by a competent legislature. Restrictions on business activities must be authorized by statute and justified under Article 19(6)—criteria not met in this case.

The reliance on Article 162 was also dismissed, as executive power cannot override the need for a statutory basis when restricting fundamental rights.

Verdict

The High Court set aside clause 3(d) of the 2013 GO and clause (a) of the 2014 GO. It ruled that the State lacked legislative authority under the MED Act to impose such prohibitions and that the GOs violated the Constitution.

Case details: [PVR Ltd. v. State of Maharashtra, Writ Petition No. 497 of 2014, decided on 10-7-2025]