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2019 (7) TMI 775 - AT - Service TaxTaxability - Business Advertising Agency - Business Auxiliary Service - Mandap Keeper Service - HELD THAT:- We find that perusal of the “Instadia Advertisement Agreement” entered into with M/s. Sporting Frontiers (India) Pvt. Ltd., the appellant has granted them the right to use the advertising sites, right to exhibit advertising of any kind and right to use advertising signs during the cricket matches and extra matches but the appellant is not providing any service connected with the making, preparation, display or exhibition of advertisement activity thereby appellant does not fit into ‘Advertising Agency’ as defined in Section 65(3) of the Act rather the said activity appropriately fall under ‘sale of space for advertisement’ which is taxable in terms of Section 65(105)(zzzm) of the Act w.e.f. 01.05.2006 whereas the period involved in the present case is from October 2005 to March 2006. Further, we find that prior to 1.05.2006, the definition of ‘Advertising Agency’ consists the word “commercial concern” and it was substituted by “any person” in the definition of ‘Advertising Agency’ w.e.f. 01.05.2006 - During the disputed period, the appellant did not fall in the definition of “commercial concern” because there is no profit motive of the appellant and the appellant is registered under Karnataka Societies Registration Act as a charitable institution - the appellants are not liable to pay service tax under ‘Advertising Agency’ and the demand of service tax confirmed under ‘Advertising Agency’ is not sustainable in law - demand set aside. Sponsorship service - HELD THAT:- As per the agreement entered with the brand owners, the appellants have received sponsorship amount towards teams and in turn the appellant has allowed the brand owners to display their brands on all the clothing worn by the team on the field during matches. This activity of displaying the sponsors logo and brand name or trade name fall under the head of ‘Sponsorship Service’ which is taxable only from 01.05.2006 whereas the period involved in the present case is prior to 01.05.2006 - This issue has been decided in favour of the appellant in the case of BCCI Vs CST [2007 (5) TMI 24 - CESTAT, MUMBAI] therefore the demand of service tax under ‘BAS’ is also not sustainable in law - demand set aside. Mandap Keeper Service - amount received for fund raising activity - HELD THAT:- The appellants have let out its ground to one Sangamitra Foundation for a fund raising activity for a consideration of ₹ 17,50,000/- but the appellant did not get the service tax from the said organization on the bona fide belief that fund raising activity is not business or official or social function - After considering the definition of ‘Mandap Keeper Service’, it is found that that this activity of the appellant fall under the category of ‘Mandap Keeper Service’ and the appellant is liable to pay the service tax amounting to ₹ 1,78,500/- - further, the appellants have not collected the service tax on this activity from the service recipient under a bona fide belief otherwise the appellants have regularly been paying service tax wherever they have charged the same under the category ‘Mandap Keeper Service’ from the service recipient. Therefore, the appellants are not liable to penalty under Section 78 but they are liable to pay interest on this service. The demand of service tax under ‘Advertising Agency Service’ and ‘Business Auxiliary Service’ is set aside - the demand under ‘Mandap Keeper Service’ along with interest is upheld - original authority will calculate the interest which the appellant is liable to pay on this service - case remanded back to the original authority who will quantify the interest on this service which the appellant will be liable to pay. Appeal allowed in part and part matter on remand.
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