2018 (6) TMI 201 - AT - Service Tax

CENVAT credit - telecast of serials produced - denial of credit on the ground that the telecasting of the serials occurs after the production of the serials - Held that - The issue has been decided in the case of RADAAN MEDIA WORKS (I) LTD. VERSUS COMMISSIONER OF SERVICE TAX, CHENNAI 2018 (2) TMI 331 - CESTAT CHENNAI , where it was held that the telecasting charges paid are used for providing the said output service of Sale of space or time for Advertisement and it was already found that the appellant is not liable to discharge service tax under the category of programme producing service. The contention of the department that programmes are telecast after production of the serials etc. is flimsy and not supported by any legal basis - credit cannot be denied - appeal allowed - decided in favor of appellant.

Summary

Issues:
Challenge to Order-in-Original regarding entitlement to avail Cenvat credit on service tax paid for telecast fees.

Analysis:
The appellant, registered under "TV or Radio production Programme Service and Sale of Space or Time for Advertisement service," assigned copyright of serials to various channels and paid telecast fees to TV channels for obtaining free commercial time. The appellant discharged service tax and availed Cenvat credit on the service tax paid. The department contended that Cenvat credit should not be allowed as telecasting occurs after production. Adjudicating authority demanded service tax, interest, and penalties for the period October 2007 to September 2010, leading to the present appeal.

The Ld. Advocate for the appellant referred to a previous Tribunal order in favor of the appellant, setting aside a similar issue and allowing the credit. The Ld. DR supported the lower authority's order, emphasizing specific paragraphs of the impugned order. The Tribunal reviewed the previous final order by the same Bench, which addressed a similar issue. The Tribunal concluded that telecast fees paid are essential for providing the output service of "Sale of space or time for Advertisement," rejecting the department's argument that telecasting occurs after production. The Tribunal found the disallowance of input service credit unjustified and set it aside, following the previous order.

In line with the previous final order, the Tribunal set aside the impugned orders and allowed the appeals, ruling in favor of the appellant's entitlement to avail Cenvat credit on service tax paid for telecast fees.