2013 (4) TMI 853 - AT - Service Tax

Summary

Issues involved:
The issue involves the demand for service tax on the grounds of providing advertisement consultancy services by the appellants.

Summary:
The appellants, registered as an Advertising Agency, filed an appeal against the order passed by the Commissioner of Central Excise (Appeals), Mumbai, demanding service tax for providing advertisement consultancy services. The appellants contended that they were registered with the Revenue as providers of advertising consultancy services and were paying service tax accordingly. They also undertook activities not related to advertising consultancy at the request of their clients, such as media plan budgeting, sales strategy development, and analysis of data. The Revenue argued that all activities were related to advertisement consultancy based on the Director's statement. However, the Tribunal found that certain activities like media plan budgeting, sales strategy development, and data analysis were not related to advertisement consultancy and set aside the demand for service tax on these activities.

In regards to media consultancy, the appellants admitted that it was related to advertising consultancy. The Tribunal acknowledged that the appellants were paying service tax regularly for advertising consultancy services and believed in good faith that media consultancy was not covered under Advertising Agency or Advertising Consultant. Thus, the demand for service tax beyond the normal period for media consultancy was set aside. Since there was no intent to evade payment of duty, the penalties imposed were also set aside. Consequently, the appellants were not liable to pay any penalty. The appeal was disposed of accordingly.