Supreme Court of India has granted two weeks time to private Direct to Home (DTH) service providers to file their replies to affidavit filed by State of Madhya Pradesh in a dispute over levy of entertainment tax on DTH service providers.

Tata Sky, Sun Direct, Bharat Business Channel Ltd. (BBCL) and Bharati Telemedia Ltd. (Airtel) have challenged the state governments decision to levy entertainment tax.

Many states are facing such disputes from private DTH operators on the validity of imposition of the tax. While state governments are asserting their right to levy entertainment tax, the private operators contend that paying entertainment tax even after paying service tax is like paying tax twice for one service.

The private operators claim that they are service providers and are already paying service tax and levying entertainment tax on them is against law.

Earlier Jabalpur bench of Madhya Pradesh High Court had dismissed the private operators appeal and held the levy of entertainment tax as valid.

The Supreme Court bench comprising of Justice Aftab Alam and Justice RM Lodha was hearing an appeal against the said order of the High Court.