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Axe of the tax

The recent ruling by the SC says that fashion shows are liable to pay tax, but FDCI seeks exemption, writes Vinod Nair.

fashion and trends Updated: Jan 11, 2008 17:48 IST
Vinod Nair

The fashion fraternity and the Supreme Court seems to be at loggerheads. The recent ruling by the apex court that ‘fashion shows or beauty contests are liable to pay entertainment tax, even if they are held as charity events' following a fashion event held in Gorakhpur, has not gone down well.

Ready to resolve Reacting to this ruling, Leena Singh, fashion designer and one of the board members of the Fashion Design Council of India (FDCI) has written to the Council seeking its intervention in the matter. Says Singh, "I have sent a letter to both the director general and the executive director of FDCI requesting them to see whether I can offer my help to coordinate with the government in resolving this."

The idea is to find a permanent solution. Singh wants to put forward a request to the government for an ordinance that can exempt fashion weeks from the purview of entertainment tax as it is a trade event.

In the past, fashion weeks organised by the FDCI in Delhi had been given exemptions from entertainment tax. Now, with the Supreme Court ruling, FDCI will have to seek exemption once again. The next fashion week in Delhi is scheduled for March this year.

Meanwhile FDCI's director general Rathi Vinay Jha is hopeful that the body will be exempted from this tax purview. "We've always got exemption from the state government as Wills Lifestyle India Fashion Week is a manufacturing event," she says. No worries for Mumbai However, this ruling will have no bearing on the Lakme Fashion Week (LFW) held in Mumbai as they never managed to get such privileges from the Maharashtra government.

Says Anil Chopra, VP of Lakme Lever's, "LFW is now two years old. Despite being the trade event, we have been paying entertainment tax for fashion weeks every season. So the Supreme Court's ruling will not really affect us."