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2024 (2) TMI 438 - AT - Service TaxExemption from Service Tax - Advertisement Agency Service - Selling of Space - covered under the Negative List or not - burden to prove on Department, whether service provided by the appellant was selling of space for advertisement or not - burden can be shifted on the Appellant or not (onus to prove) - interest and penalty - HELD THAT:- The Appellant is providing service of displaying the advertisement through various mode such as hoarding, kiosk, etc. However, he is not providing the services like basic planning of advertising, preparing the detail exhibition program for advertisement. On the basis of planning, printing of the material for display or exhibition the service of selling of space or time slots for advertisements falls under negative list of Services specified under Section 66D (g). The words "selling of space or time slots" for advertisement are not defined in the act therefore, the meaning of these words is to be understood in commercial parlance which means providing space for displaying advertisement. At the time of introduction of new service, the Joint Secretary, Ministry of Finance, Department of Revenue, Government of India issued a clarification on this service vide D.O.F. 334/4/2006-TRU dated 28.02.2006 which shows that advertisement on building covers under the scope of sale of advertising spaces. The customer or client approaches the appellant with advertisement material and the appellant displayed the same on a space for a particular period and charge the customer on monthly basis. After expiry of the period the advertisement is removed. Such activities of providing space for displaying advertisement was covered in the Negative list and as such not taxable. It is evident from the details given in above invoices that the Appellant was not engaged in designing and conceptualising advertisement. The Tribunal has observed in the case of Zodiac Advertisers [2006 (3) TMI 138 - CESTAT, BANGALORE] that a service is covered under Advertising Agency service when all activities as mentioned in the definition are done by a person - The ratio of the above decision are squarely applicable in this case also and demand of service tax for that period is not sustainable. Interest and penalty - HELD THAT:- The issue is no more resintegra. Once demand is not sustainable, penalty imposed under Section 78 of the Finance Act, 1994 would not be imposable. The penalty imposed on the partner, Shri Sanjay Adhlakha is also set aside. The Late Fee is restricted to Rs.1,00,000/-. The demand of Service Tax alongwith applicable interest set aside - The penalty imposed under Section 78 on the Appellant firm and under Section 78A on the partner Shri Sanjay Adhlakha are set aside - appeal allowed in part.
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