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2015 (12) TMI 1320 - AT - Service TaxBusiness auxiliary service - Valuation - Inclusion of Royalty - Appellant provided service to telecommunication operators to make use of the contents provided to it though the copyright agreement entered into with the music companies - Held that:- There is a demarcated line in the licensing agreement itself demonstrating that the telecommunication companies were stranger to the copyright owners which were the music companies. There was a privy between the appellant and the music companies to distribute the copyright what was conferred by the music company on the appellant. Therefore, Revenue has nothing to do to make an exercise to bring music companies into the picture to determine incidence of tax. Revenue proceeded on the fact that what was realized by the appellant was undisputedly in respect of taxable service provided to the telecommunication operators. That receipt should be brought into the tax ambit. They have done so. The appellant has collected appropriate service tax in respect of the value of service provided to the telecommunication operators. That does not give any scope to bifurcate tax element. Prima facie, examination of the license agreement extracted by the learned adjudicating authority in the impugned order shows that the copyright holder was also aware that the appellant is going to exploit the copyright for mutual benefit of each other. Therefore, at this stage it looks like a case of advancement of business of music companies by the appellant. Therefore, prima facie, liability of appellant arises. - Partial stay granted.
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