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TMI Blog2014 (9) TMI 180X X X X Extracts X X X X X X X X Extracts X X X X ..... rvices" to their various clients. As per the request of the clients, they place the advertisements on their behalf in various print media and electronic media. The print/electronic media in which the advertisements have been placed are decided by the clients and the duration and the size of the advertisement to be placed are also decided by the clients. The appellant, as an advertising agency, places the advertisements in the print/electronic media on behalf of the clients, who is the advertiser and on the agency commission received, they have discharged the service tax liability. The present demand is on account of volume discount received from these media, write back of the amount in respect of payments not claimed by the print/electronic media and the rate difference between the amount actually charged from the advertiser and the amount paid to the media. The department seeks to levy service tax on these amounts under the category of "Business Auxiliary Service" (BAS) on the ground that the appellant is promoting the business of print/electronic media by canvassing/booking orders on their behalf and therefore, these activities are liable to service tax under BAS. There is also a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... write backs the amount and the amount is no longer shown as outstanding. However, as and when the amounts are demanded by the media, they have to reimburse the amounts to the media towards short payments made earlier and therefore, this cannot be considered as a consideration for any services rendered. As regards the rate difference on which serviced tax has been demanded, this is also in the nature of a discount between the rates originally quoted and the rates actually charged. Thus it is only a trade margin given by the media and therefore, this also cannot be considered as receipt for any services rendered. The learned Counsel places reliance on the decision of this Tribunal in the case of P.Gautam & Co. Vs. CST, Ahmedabad - 2011 (24) STR 447 (Tri-Ahmd) wherein it was held that discounts and incentives received by the advertising agency from the print media cannot be considered as charges for the services rendered and therefore, there is no service tax liability under BAS. This decision of this Tribunal was based on an earlier decision of this Tribunal in the case of Euro RSCG Advertising Ltd. Vs. CST, Bangalore - 2007 (7) STR 277 (Tri-Bang) wherein also the incentives receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OL-1385-CESTAT-DEL . In the said case the respondent/assessee was recovering service tax from its clients and had suppressed the value of advertising services provided by it and deposited only a portion of the amount of service tax. The demand of service tax was confirmed under the category of sales/advertisement in print/electronic media and in that context, the Tribunal upheld the Revenue's appeal by upholding the levy of service tax. It is the contention of the learned AR that the ratio of the said decision would apply in the present case also. 4. We have carefully considered the submissions made by both the sides. 4.1 From the nature of the transactions undertaken in the present case, it is seen that the appellant is rendering advertising agency services to various clients who are the advertisers. On behalf of these advertisers, the appellant has placed advertisements in the print/electronic media. The choice of the print/electronic media is with the advertiser and not with the advertising agency, who merely co-ordinates between the media and the advertiser. On the agency commission received, they have discharged service tax liability. Similarly, the electronic media also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /- along with service tax. The service tax component received from the advertising agency in turn is remitted to the exchequer by the media agency. The appellants have demonstrated that they have not received any amount from the media. They got only a discount from them. Perhaps the word "commission" is misleading. There is actually no evidence that the said amount has been received by the appellant from the media. In any case, any amount received by the appellant from the media. In any case, any amount received by the service provider from his client only is liable to service tax and not amounts received from others. The adjudicating authority has neither considered the factual position nor the legality of the entire issue. The impugned order 12/2005 dated 27.4.2005 has no merits. Since there is no service tax liability, there is no question of imposing penalty and demanding interest. Hence we set aside the same and allow the appeal with consequential relief." 4.2 The same view was reiterated by the Tribunal in the case of P. Gautam & Co. (cited supra). In the said case the Tribunal observed that: "It is seen and as correctly pointed out by the learned counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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