2015 (11) TMI 1108 - AT - Service Tax

Waiver of pre deposit - Business Support Services - SSI Benefit - Held that - The applicants admitted the classification and duty liability under BPS for July, 2010 but disputed valuation. On perusal of the 2011 year agreement, it is seen that schedule1/1A (1) agreement mentions 10% of the player fee relates to sponsorship and brand promotion. However, no such specific clause exists in the earlier agreements pertaining to demand period. We also find that in the subsequent demand raised by the department No.62/2012 dated 22.10.12 the demand restricted to only 10% of the player fee. The valuation dispute and claim of SSI benefit will be considered at the time of final hearing. - Therefore by taking into consideration of the pre-deposit already made by the appellants other than Sl. No. 2,4 and 6 made before the Commissioner (Appeals), which is sufficient and the balance amount of dues shall be waived and its recovery stayed in the disposal of the appeals - Partial stay granted.

Summary

Issues:
Demand of service tax on IPL players for participation in the tournament, classification under Business Support Service and Brand Promotions Service, denial of Small Scale Industry (SSI) benefit, valuation dispute, pre-deposit waiver.

Analysis:
The judgment dealt with the demand of service tax on IPL players participating in the tournament under Business Support Service and Brand Promotions Service. The Commissioner (Appeals) partially allowed the appeals, setting aside the demand under Business Support Service before 01.07.2010 and upholding the demand under Brand Promotions Service from 01.07.2010 onwards. The players argued that only 10% of the payment was towards Brand Promotion Service, within the SSI limit, supported by a 2011 agreement clause. However, no such clause existed in earlier agreements. The Tribunal noted a subsequent demand restricting the amount to 10% of the player fee, indicating a valuation dispute to be considered later.

The players' consultant submitted a worksheet showing pre-deposits by each player, with most exceeding 10%. The Tribunal decided to waive the balance amount due for those who had already made sufficient pre-deposits, directing the remaining players to make specific pre-deposits within four weeks. Compliance would lead to a waiver of the balance dues and a stay on recovery until the appeals' disposal. The judgment emphasized linking the appeals with the impugned order and similar issues for efficient handling.

The Assistant Revenue reiterated the Commissioner (Appeals) findings, emphasizing that players promote the franchisee's brand value, making no distinction between playing and brand promotion. The Tribunal acknowledged the lower appellate authority's decision to set aside the demand under Business Support Services and confirm the demand under Brand Promotion Service. The Tribunal noted the classification and duty liability under Brand Promotion Service for July 2010 were admitted, with a valuation dispute remaining unresolved.

In conclusion, the judgment addressed the issues of service tax demand on IPL players, classification under different services, denial of SSI benefit, valuation disputes, and pre-deposit waivers. The Tribunal considered the arguments from both sides, analyzed the agreements, and made decisions regarding pre-deposits and balance dues, emphasizing compliance and efficient handling of related appeals.