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2013 (7) TMI 22 - HC - Service TaxService tax from film distributors/sub-distributors/theatre owners - challenge the Circular No.148/17/2011-ST dated 13.12.2011 bearing F.No.354/27/2011-TRU - service tax on Copyright Services - Held that:- The impugned Circular above has examined different types of arrangements between distributor/sub-distributor or exhibitor of the movie. It is a clarification on levy of service tax on distributors/sub-distributors of films and exhibitors of movie. Under the new service tax regime, as per Section 66D, all services will be liable to tax except those which are specifically mentioned in the exemption notification and the Negative List. Section 66B of the Act levies tax on all services other than those services specified in the Negative List. Section 66D of the Finance Act 1994 sets out the various services that are not liable to be taxed in the sense that they do not fall under the charging Section 66B. As per Section 66D(j), "admission to entreatment events or access to amusement facilitates", are exempted from service tax, thus are non-taxable Negative List services. What is not taxable is "tax on admission to entertainment events or access to amusement facilities", the reason, being, "tax on admission or entry of such events is covered in the State List, which is subjected to Entertainment Tax. The Central Government has issued Mega exemption Notification No.25/2012-S.T dated 20.06.2012. As pointed out earlier, from 2012, the basis of levying service tax was changed from "service specific levy" to "levying tax on all services except services specified in Negative List and the Exemption Notification." By a combined reading of Section 66D(j), Notification Nos.25/2012-S.T dated 20.06.2012 and 3/2013-S.T. Dated 1.3.2013, it is clear that what is exempted is only an admission to entertainment events or access to amusement facilities or exhibition of cinema in a theatre. The variant modes of transaction between the distributor/sub-distributors of films and exhibitors of movie and the revenue sharing arrangement between them are neither in the "Negative List Services" nor exempted. The impugned Circular No.148/17/2011-ST dated 13.12.2011 cannot be said to be beyond the powers of Central Board of Excise and Customs. The Circular does not restrict the powers of the officials to decide a particular dispute in a particular manner and the impugned circular is not violative of Section 37B. All the writ petitions are liable to be dismissed.
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