9911796707
TMI Blog2008 (1) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellants Shri N.J. Kumaresh, SDR for the Respondent [Order] - This application is filed by M/s. SHRIJI ADS, Chennai for waiver of predeposit and stay of recovery of service tax of an amount of Rs.2,02,080/-, a penalty of Rs.1,94,000/- imposed under Section 76 of the Finance Act 94 (the Act) and another penalty of Rs.1,000/- imposed under Section 77 of the Act. The appellants are engaged in rendering advertisement service. In addition to displaying advertisements, the appellants also leased out hoardings to its associates who undertook the activity of displaying advertisements. The demand has been raised on the appellant for leasing out hoardings; for service tax on the leased amounts collected. The appeal has been filed w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r above plea. The said communication had clarified that when a hoarding company provided service of display of an advertisement to an advertiser, the hoarding company was the 'service provider" and the advertiser was the 'client'. The gross amount charged by the hoarding company to the client was liable to pay service tax. But when the hoarding company billed an intermediary i.e., an advertising agency, which in turn billed the clients, then the advertising agency/intermediary was the service provider who was liable to pay tax. It is argued that in view of the above clarification, the original authority could not have demanded the impugned tax on charges for leasing out hoardings to an advertisement agency. Moreover, the department was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t had not made any effort to verify whether the tax demanded was due from the appellants in view of the clarification issued by the department. The learned counsel prays that the matter may be remanded so that they could furnish the required evidence to establish that they were not liable to pay the impugned tax in terms of the clarification issued by the Commissioner. 6. The learned SDR has no objection to the matter being remanded to give an opportunity to the appellants to establish that the tax due had already been received by the department. 7. I have carefully considered the facts of the case and the submissions made by both sides. The following is an extract from the letter issued by the Commissioner to the Tamil Nadu O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he advertising company who is responsible to pay service tax on the gross bill amount including the money paid to the hoarding company, as they are actually billing the clients. The hoarding company should however ensure that the person, to whom the board is let out, is registered with Service Tax as an Assessee." (highlghts as in original) 7.1 There cannot be any dispute that the appellant is covered by the statutory definition of "advertising agency", being a commercial concern engaged in providing service connected with the making, preparation, display, or exhibition of advertisement. As per the clarification, when a hoarding company like the appellant billed an intermediary i.e., an advertising agency which in turn billed its c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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