TMI Blog2012 (11) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... ong with other facilities specified therein. It is not the case of the department such facilities have been provided to the book makers or the caterer. Therefore, no merit in the argument that the renting of office space to the caterer/book maker is liable to be classified as business support service. - Decided in favor of assessee. - ST/203, 217 & 218/10 - A/498 TO 500/2012/CSTB/C-I - Dated:- 22-5-2012 - Ashok Jindal, P R Chandrasekharan, JJ. For Appellant: Shri Bharat Raichandani, Adv. Shri S S Gupta, CA For Respondent: Shri P N Das, Comm. (AR) Per: P R Chandrasekharan: 1. There are three appeals which are taken up for consideration together as the issues involved are common. 2. The appellant, M/s. Royal Western India Turf Club Ltd. (Turf club, in short) is engaged in the activity of conducting horse racing. During the horse race, licensed book makers (bookies in short) accept bets from the public in the premises of the appellant and these bookies have been provided with stalls. The appellant charges fees from the bookies in two components, one is a fixed amount under the Head Stall fees and the other is a variable amount under the Head Commission which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fixed amount paid by the bookies, the same was categorized as Business Support Services and the variable paid by the bookies was categorized as Intellectual Property Right Services. As regards the royalty amount from the caterers, the same was classified as income from Business Support Services. The said notice was adjudicated vide Order No. 23/BR-23/ST/TH-I/2010 dated 31.03.2010 wherein the Commissioner confirmed the service tax demand classifying the services under Broadcasting Services, Intellectual Property Right Services and Business Support Services under Section 73 of the Act ibid along with interest under Section 75 and imposed penalties under Sections 76, 77 and 78 of the Finance Act, 1994. 2.3 Two more show-cause notices were issued on 03.10.2008 and 09.10.2009 for the Financial Years 2007-08 and 2008-09 demanding service tax amount of ₹ 1,63,15,303/- and ₹ 2,12,15,287/- respectively and these show-cause notices were adjudicated vide Order No. 24 25/ST/BR/09-10 dated 08.02.2010 by the Commissioner of Service Tax, Mumbai who confirmed the service tax demands under the category of Intellectual Property Right Services, Broadcasting Services and Business Sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P. Mandal vs. CCE [2006 (3)STR 183 (Bom)] in this regard. (3) As regards for demand of service tax under the category of Intellectual Property Right Services, the Advocate relies on the CBEC Circular No. 80/10/2004-ST dated 17.09.2004 wherein it was clarified that the Intellectual Property Right Services covers such rights as patent, copy rights, trade marks and designs under the Intellectual Property Rights laws applicable in India. Neither in the show-cause notice nor in the adjudication order, the adjudicating authority has classified the services rendered and the consideration received as falling under which Intellectual Property Right they would fall i.e., whether under the category of patents, copy rights, trade marks or designs. (4) As regards the demand of service tax under the category of Broadcasting Services, the learned Counsel submits that in the instant case the broadcasting is undertaken by M/s. Essel Shyam Communications Ltd., who has charged the appellant Turf Club for the services rendered under the category of Broadcasting Services and the appellant has paid service tax to M/s. Essel Shyam Communications Ltd., for the services received, and, therefore, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices. 5. We have carefully considered the rival submissions. 5.1 A perusal of the impugned orders clearly evidences the lack of clarity and understanding on the part of the department. The activity of live telecast of the horse race has been classified as broad casting services during one part of the period and during another period, the very same activity is classified as intellectual property rights service. Further, during the same period, the activity has been classified under the above two categories based on the mode of payment for the services, that is, whether is payment is lump sum or varying as a percentage of the bet amounts. In other words, the different classifications have been adopted based on different modes of payment, for the same activity. The same confusion prevails in respect of the consideration received from the book makers. There is a total confusion in the minds of the adjudicating authorities as to the nature of the tax and the measure of the tax. On this ground alone the impugned orders deserve to be set aside. 5.2 Further where the demand for service tax has been made under the category of Intellectual Property Right Services, neither the show-c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is available for viewing only in other race clubs and only members or bookies in the other race clubs can view the programme. It cannot be, therefore, said that the broadcast is available for public viewing. 5.4 The appellant herein is involved in conducting the event of horse racing. The appellant has permitted other race clubs to commercially use or exploit this event. The appellant receives a royalty from these race clubs towards this right to commercial use or exploitation. Thus the activity undertaken by the appellant merits classification under the taxable category of services of permitting commercial use or exploitation of any event organized by a person or organization which was brought under the tax net with effect from 1-7-2010. It is only from this date, the service tax liability is attracted on this activity. In the instant case as the service tax demand is for the period 01.04.2007 to 31.03.2009, they will not be liable to service tax during this period. 5.5 The CBEC circular 334/1/2010-TRU dated 26-2-2010 clarified the position as under: 5. Services of permitting commercial use or exploitation of any event organized by a person or an organization. 5.1 Lik ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay of stall or canteen, for a consideration. This activity is nothing but hiring/leasing of immovable property defined under clause (zzzz) of section 65 (105) of Finance Act, 1994 which defines the service as renting of immovable property or any other service in relation to such renting, for use in the course of or for furtherance of business or commerce. Business support service is defined in clause (104c) of section 65 as follows:- Support services of business or commerce means services provided in relation to business or commerce and includes evaluation of prospective customers, telemarketing, processing of purchase orders and fulfillment services, information and tracking of delivery schedules, managing distribution and logistics, customer relationship management services, accounting and processing of transactions, operational or administrative assistance in any manner, formulation of customer service and pricing policies, infrastructural support services and other transaction processing. Explanation.- for the purposes of this clause, the expression infrastructural support services includes providing of office space along with office utilities, lounge, reception with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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