2007 (11) TMI 180 - AT - Service Tax

Appellant, sole proprietary concern, painter, providing services connected with making preparation, display & exhibition of advertisements & also providing consultancy in advertisements - matter which was to be advertised was already in the photographs supplied to the painter who merely painted the same on walls - all the activities mentioned in definition of advertising agency weren t carried out by the appellant so activity of mere painting not fall in the category of advertising agency

Summary

Issues:
Challenge to Service Tax demand and penalties under Sections 76 and 78 of the Act for rendering advertising services without registration.

Analysis:
1. The appellant, a sole proprietary concern, contested the order confirming a Service Tax demand of Rs.1,23,821/- with penalties under Sections 76 and 78 of the Act. The Revenue alleged the appellant provided advertising services to a company without proper registration. The appellant argued that he was merely a painter and not involved in advertising activities like designing or conceptualizing.

2. The Appellate Commissioner upheld the order, stating the appellant indeed provided advertising services based on the definition of 'advertising' and 'display'. The appellant's contention that he was only a painter was dismissed.

3. The appellant further argued that painting on walls did not constitute advertising agency services, citing relevant case law and circulars. The Department's representative contended that the appellant's business name implied advertising services and that the appellant was involved in making and displaying advertisements.

4. The Tribunal analyzed the appellant's role in painting advertisements provided by the company. It was noted that the appellant's painting work did not involve activities like designing or conceptualizing, as required for an 'advertising agency'. Previous judgments supported the view that mere painting without creative input did not qualify as an advertising service.

5. The Tribunal found that the appellant's activities did not align with the definition of an 'advertising agency'. The judgment emphasized the importance of creative input in advertising services, which the appellant lacked. Therefore, the demand and penalties were set aside, and the appeal was allowed.