Bombay HC asks Centre, Maharashtra to rule on Imagicaa incentive plea soon

The Bombay High Court has directed the Centre and Maharashtra to take a time-bound decision on Imagicaaworld's plea seeking an extension of tourism incentives for its theme and water parks

The Bombay High Court has directed the Centre and the Maharashtra government to take a time-bound decision on Imagicaaworld Entertainment Ltd’s request for extension of tourism incentives linked to its theme and water parks, while refraining from ruling on the merits of the dispute.

 

In the court order dated February 12, 2026, which was recently made public, a division bench of Justices G.S. Kulkarni and Aarti Sathe disposed of the writ petition after noting that the issue involves a policy decision requiring inter-ministerial consultation. The court asked the authorities to decide the company’s representation dated January 11, 2024, “as expeditiously as possible,” preferably within two months of receiving the order.

   

The petitioner had primarily pressed for extension of the entitlement period granted under earlier state tourism policies to help it recover investments following changes in the tax regime after the rollout of the goods and services tax (GST).

 

Imagicaaworld Entertainment, formerly Adlabs Entertainment, operates the Imagicaa theme park and Aquamagica water park in Raigad district. The projects were recognised as “mega projects” under Maharashtra’s Tourism Policy, 2006.

 

Under entitlement certificates issued in 2013 and 2015, the company was granted entertainment tax (ET) exemptions worth ₹724.39 crore for the theme park and ₹101.06 crore for the water park for a period of 10 years.

 

The company argued that the introduction of goods and services tax (GST) in July 2017 subsumed the earlier ET regime, creating uncertainty over the balance incentives promised under the state policy. It said the time limit to fully realise exemptions of about ₹825 crore had already expired for the theme park in June 2025, while the water park benefit is due to expire in May 2027.

 

The petitioner also pointed to prolonged closures during the Covid-19 pandemic and said it had repeatedly sought extension of the incentive period and other reliefs, including refund mechanisms.

 

While the state had earlier accepted recommendations of a high-level committee and allowed SGST refunds in 2020, the company maintained that the issue of lower GST rates vis-à-vis the earlier 15 per cent entertainment tax remained unresolved.

 

In October 2023, the state extended the incentive period by two years for the Covid disruption, but did not address the core grievance on the reduced effective benefit. Tax experts said the order could have wider implications for legacy incentive disputes arising after the GST transition.

 

Abhishek A. Rastogi, founder of Rastogi Chambers and counsel for the petitioner, said the ruling reflects judicial restraint while ensuring administrative accountability. “By directing a time-bound decision after hearing the petitioner, the court has created a structured pathway that could help resolve disputes arising from the transition to GST where legacy incentives were promised,” he said.

 

During the hearing, the state submitted that the government would consider the company’s request and decide whether it is entitled to further extension of incentives. Accepting this position, the bench said the matter requires dialogue between the tourism and finance departments and left it to the concerned ministries to take an appropriate decision after giving the company an opportunity of hearing.

 

The court clarified it has not expressed any view on the merits and kept all issues open.