9911796707
TMI Blog2008 (1) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... Rekha Kumar for the Appellant. N. J. Kumaresh for the Respondent. ORDER 1. This application is filed by M/s. Shriji ADS, Chennai for waiver of pre-deposit 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, 1994 ('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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort of their 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. Moreo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f leasing the hoarding. Department 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 Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were booked by the advertising agency, then the hoarding company need not pay service tax. But it is the 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. 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 appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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