Even as India’s apex court prepares to reignite the country’s debate around homosexuality in the weeks to come, one filmmaker from the western state of Gujarat who directed a movie on the subject remains locked in a three-year battle with the state’s tax authorities.

Kiran Kumar Devmani has been denied a customary entertainment tax exemption for his film Meghdhanushya — The Colour of Life on the grounds that it could send a “negative signal” to the public, Agence France-Presse (AFP) reports.

Despite the Gujarat High Court’s ruling that Devmani should receive the exemption — a common procedure instituted to protect artists’ revenues — the state government has remained firm in its refusal to endorse “such ideology.”

“What is controversial about homosexuality?” the 30-year-old asked in an interview with AFP. “My film does not have a single scene where gay men are shown even holding hands.”

Same-sex relationships are a sensitive subject in India, where homosexuality is still illegal based on a colonial-era law called Section 377 that was initially struck down in 2009 but reinstated in 2013. The law is now being revisited, however, with India’s Supreme Court agreeing to review the 2013 decision earlier this week, sparking renewed hope among the country’s gay-rights activists. It will now be referred to a higher five-judge bench, although a specific date for that ruling has not been set.

In the meantime, films that deal with the issue still attract intense scrutiny and various bureaucratic hurdles — and Devmani’s isn’t the only one. The trailer for an upcoming film called Aligarh, based on a true story about an Indian college professor sacked from his job for being gay, has been given an ‘A’ (adult) certificate by the country’s censor board — as was Devmani’s — considerably restricting its approved audience.

“They [the censors] are behaving like a homophobic society,” the Hindustan Times newspaper quoted Aligarh director Hansal Mehta as saying.

Devmani, meanwhile, is on the verge of throwing in the towel on his protracted battle with the government and accepting the tax, which deducts 25% of all box-office revenues.

“I will wait for the next six months and then release the film even if the exemption is not granted,” he said.

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Write to Rishi Iyengar at rishi.iyengar@timeasia.com.