2009 (10) TMI 669 - AT - Service Tax

Waiver of prre-deposit - Levy of service tax - sale of space and time for advertisement through Instadia advertisement - Held that - the case of the appellants is an arguable one as they have not made out a case for complete waiver of the pre-deposit. They have also not pleaded any financial hardship. As such taking into consideration the amount of ₹ 27,70,469/- already paid by the appellants, we direct them to predeposit a further amount of ₹ 20,00,000/- - decided partly in favor of appellant.

Summary

Issues:
1. Contesting demand of Rs. 93,21,222/- for renting of immovable property.
2. Contested amount of Rs. 14,14,950/- in relation to sale of space and time for advertisement through Instadia advertisement.
3. Demand of Rs. 28,89,879/- for sale of space and time for advertisement in respect of the stands.
4. Demand of Rs. 50,16,393/- for sale of space and time for advertisement in respect of the boxes.
5. Argument regarding sponsorship service and tax liability.
6. Opposing waiver of pre-deposit for the appellants.

Analysis:
1. The appellants contested a demand of Rs. 93,21,222/- for renting immovable property, expressing no grievance against Rs. 1,09,766/-. Specifically, Rs. 14,14,950/- was related to Instadia advertisement sales, where Service tax was paid by Instadia on the full amount received, with only a partial amount transferred to the appellants. The appellants argued that if they pay Service tax on this amount, Instadia should be allowed to claim credit.

2. Regarding the demands of Rs. 28,89,879/- and Rs. 50,16,393/- for advertisement space in stands and boxes, the appellants received payments from sponsors for sponsorship. They contended that the charges were for sponsorship services, and the sponsors should be liable for any tax, not the appellants. The Jt. CDR opposed waiving the pre-deposit, emphasizing that even tickets sold for seats in stands and boxes carried sponsor advertisements.

3. The Jt. CDR argued that even if Instadia paid full Service tax, the appellants were still liable for tax on the amount received. The provision for availing credit of Service tax did not exempt the appellants from their tax liability. The tribunal found the appellants' case arguable but directed a pre-deposit of Rs. 20,00,000/-, considering the amount already paid. Compliance was to be reported within eight weeks, with the balance pre-deposit waived during the appeal's pendency, and recovery stayed. The appellants did not claim financial hardship, leading to the decision on the pre-deposit amount.