9911796707
TMI Blog2017 (1) TMI 436X X X X Extracts X X X X X X X X Extracts X X X X ..... adcasting agency service.' 2. M/s Multi Screen Media Limited (formerly known as M/s SET India Pvt Ltd) was subjected to proceedings for alleged non-payment of tax of Rs. 2,54,22,950/- on income of Rs. 34,45,17,232/- received from music companies for the period from 1st July 2001 to 31st September 2005. Service tax authorities claim that these receipts had been suppressed by the appellant despite being chargeable to tax under section 65(105)(zk) of Finance Act, 1994. The appellant had been discharging tax on the consideration for the said activity only with effect from 1st May 2006 when section 65(105)(zzzm) was incorporated in Finance Act, 1994 to levy tax on 'sale of space or time for advertising service' though section 65(105)(zk) of Fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the country, the liability to tax was fastened with effect from 1st July 2001 and not under the claimed head of 'sale of space or time for advertisement'. Reliance was also placed on circular no. 334/4/200-TRU dated 28th February 2006 issued when the latter levy was incorporated which intended the levy to bring such providers who, not being providers of 'broadcasting agency service', sell space or time for advertisement within the tax net. Holding that this exclusion implied the taxability of the service in the hands of appellant from 1st July 2001, the adjudicating authority cited the decision of the Tribunal in Vijay Television (P) Ltd v. Commissioner of Service Tax, Chennai [2009 (13) STR 296 (Tri. Chennai)], Siticable Network P Ltd v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roducers of music who resort to these fillers as means of providing a preview of proposed entertainment. 5. Learned Authorised Representative drew attention to the decisions relied upon by the adjudicating authority to arrive at that conclusion that the income so collected is taxable as 'broadcasting agency service', viz., the decisions in re Zee Telefilms Ltd and Vijay Television (P) Ltd. 6. We must premise generally that rendering of a service is not openly manifest and the conclusion of the activity is evidenced in the satisfaction obtained by the recipient of service. Consequently, the disbursement of consideration is not the sole indication of that satisfaction but the purpose for which the consideration has been paid. We note that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ercial ventures in related areas, cannot be held to be non-existent. Their claim to be a production-house supplying programmes for broadcasting though the overseas up-linking facility implies existence of contracts for purchase of slots from the overseas broadcasting agency and, in turn, production of programmes that do contain advertisement spots purchased by various music companies. It is their contention that, in this business model, any activity of theirs that goes beyond selling of time-slots to producers for broadcasting of programmes, obtaining sponsorship for programmes and collecting of broadcasting charges on behalf of the broadcasting agency are on their own account and not taxable under section 65(105)(zk) of Finance Act, 1994. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of broadcasting industry has not been examined by the adjudicating authority. The appellant is a production-house which produces programmes that are broadcast by the overseas broadcasting agency and for which slots are booked with the overseas broadcasting agency. At the same time, the appellant engages commercially with the clients of the overseas broadcasting agency on which tax dues therein, as provider of broadcasting agency service are discharged. Only a scrutiny of the contract terms relating to those programmes for which fillers are sold to music companies, and was the subject matter in the proceedings before the adjudicating authority, will attest to the veracity of the claim. If such ascertainment of the nature of commercial engage ..... X X X X Extracts X X X X X X X X Extracts X X X X
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