TMI Blog2014 (9) TMI 598X X X X Extracts X X X X X X X X Extracts X X X X ..... he scope of the said service and hence demand of service tax on this service under the category of programme producer's service is not sustainable in law. - Decided partly in favor of assessee. Extended period of limitation and levy of penalty - Held that:- There has been no undue delay on the part of the department either in completing the investigation or in issue of the show cause notices. Further, we observe that though the appellant has claimed bonafide belief, no material has been placed before us, either by way of expert opinion or otherwise, as to the basis for entertaining such belief. - A belief can be said to be bona fide only when it is formed after all reasonable considerations are taken into account as held by this Tribunal in the case of Interscape Vs. Commissioner of Central Excise, Mumbai- I [2005 (9) TMI 192 - CESTAT, MUMBAI] - Appellant has suppressed material facts from the department and hence, extended period of time has rightly been invoked for confirmation of service tax demand. - levy of penalty confirmed - Decided against the assessee. - Appeal Nos.ST/32 & 300/12-Mum - Final Order Nos. A/1395-1396/2014-WZB/C-I(CSTB) - Dated:- 26-8-2014 - P R Chandras ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in the statute] along with interest and also by imposing penalties. 4. The learned consultant for the appellant made the following submissions. 4.1 The services provided by the non-resident service providers related to recording of cricket images and such recordings were intended to be transmitted for viewing by the general public. The service providers did not produce any programme but were merely recording the cricket matches organized/held by BCCI and they had no control over the cricket matches. Therefore, it cannot be said that the non-resident service providers were producing any programme either for BCCI or on behalf of BCCI. Therefore, the services of audio visual recording of the cricket matches do not fall under the category of programme producer's services and the impugned demands are not sustainable in law. 4.2 The service providers undertook both audio as well as visual recording of the cricket matches. The taxable service under programme producer's services covers either audio recording or visual recording and does not cover recording of both together. Therefore, the activity undertaken by the non-resident service providers do not come strictl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s cannot be sustained in law. 5. The learned Commissioner (AR) appearing for the Revenue, reiterates the findings of the adjudicating authority. He also relies on the terms of the contracts entered into by the appellant with the non-resident service providers, wherein the persons recording the cricket matches are described as producers, and production specifications have been given in the contract. Therefore, the services received by the appellant squarely falls within the definition of programme producer's services and, therefore, the impugned demands are clearly sustainable in law. 6. We have carefully considered the submissions made by both the sides. We have also perused the contracts entered into with the service providers. 6.1 The agreement is titled as Television production for international and domestic cricket . As per the recital in the contract entered into with M/s. Nimbus Sport International Pte. Ltd., the appellant has accepted the bid tendered by Nimbus Sport International Pte. Ltd. who has been referred to as 'the producer' in the agreement and has agreed to appoint the producer to produce audio visual coverage of the events on behalf of BCCI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es intended to be received by the general public either directly or indirectly through the medium of relay stations; (86b) programme producer means any person who produces a programme on behalf of another person From the reading of the contract, we find that the service provider has installed 30-32 cameras in the stadium to capture the images of the cricket match. The appellant has set up a broadcast control room (BCR) in the stadium where the match is played. The images taken by the cameras are transmitted to vision colour correction unit and the same are viewed by the experts and after processing, these images are transmitted to the director's vision desk. 6.4 The nature of activities undertaken by the service provider is as under:- (i) The broadcast control room (BCR) is set up by the company in the stadium. It has various units, viz. Vision colour correction unit, Director's vision desk, sound engineer desk, replay desk, graphic desk, hawk eye unit, ball speed machine, other machine routers, commentary unit, monitor wall. (ii) Around 30-32 cameras are fixed around the ground to take image of not only play but also of crowds and other h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indirect significance depending on the context. The Hon'ble Bombay High Court in the case of ONGC vs CCE, Raigad [2013 (32) STR (Bom)] has held that where the legislature or its delegate uses the expression in or in relation , its object and purpose is to widen the scope and purview of its entitlement . In other words, these are expressions of width and amplitude and cover within its scope any activity which is connection with the main activity. In this view of the matter, the activities undertaken by the non-resident service providers squarely falls within the definition of programme as defined in section 65 (86a) and the service providers are 'programme producers' as defined in section 65 (86b). 6.6 As regards the contention that in respect of Hawkeye Innovations Ltd., they were only supplying software programmes for recording, this contention does not seem to be flowing from the contract entered into with Hawkeye Innovations Ltd. A perusal of the agreement with Hawkeye Innovations Ltd. shows that Hawkeye Innovations was required to supply four units in connection with the production by IMG Media for BCCI of the world feed live coverage on the IPL in the se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as vice versa to give effect to the manifest intention of the Legislature as disclosed from the context [Ishar Singh Bindra vs. State of U.P.) AIR 1968 SC 1450)]. In page 478 of the said book, it is stated that in section 2(1)(d)(i) of the Bombay Lotteries and Prize Competition Control and Tax Act, 1948, the Supreme Court read 'or' as 'and' to give effect to the clear intention of the Legislature as expressed in the Act read as a whole [State of Bombay v. RMS Chamarbaugwala, AIR 1957 SC 699] . Applying these principles to the facts of the present case, to give effect to the manifest intention of the legislature, the expression audio or visual matter can be read as audio and visual matter . Therefore, we do not find any merit in the contention raised in this regard by the appellant. 6.9 As regards the contention that since the programme is produced on behalf of BCCI, there should be a third person, which is lacking in the present case, this contention is also not tenable. The statutory definitions of 'programme' and 'programme producer services' do not envisage the presence of a third party. Whether the programme is produced for BCCI or on be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non-resident service providers and the consideration paid therefor was never declared to the department in the statutory returns filed by BCCI. In terms of the provisions of section 66A read with section 68 of the Finance Act, 1994, the appellant BCCI was the person responsible for paying service tax and it was their duty to comply with the statutory requirements which they failed to do. Both in the show cause notices as well as in the impugned orders, the fact of suppression/withholding of information has been examined and discussed at length. Only after the commencement of the investigation by the department, the true nature of the various transactions undertaken by the appellant came to light. Information relating to the transactions were given to the department in August 2009 and thereafter. After completion of investigation, the show cause notices were issued without any undue delay. In these circumstances, invocation of extended period of time cannot be faulted at all. There has been no undue delay on the part of the department either in completing the investigation or in issue of the show cause notices. Further, we observe that though the appellant has claimed bonafide belie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aised a contention as to whether penalties can be imposed both under Sections 76and 78 of the Finance Act, 1994, simultaneously. Reliance has been placed on the decision of Industrial Security Protection Services (supra) wherein a single member bench has referred the matter to a Larger Bench in view of the conflicting decisions by the hon'ble Kerala and Karnataka High courts. The Hon'ble High Court of Kerala in the case of ACCE vs. Krishna Poduval reported in 2006 (1) STR 185 (Ker.) held as follows:- 11. The penalty imposable under section 76 is for failure to pay service tax by the person liable to pay the same in accordance with the provisions of section 68 and the rules made thereunder, whereas section 78 relates to penalty for suppression of the value of taxable service. Of course, these two offences may arise in the course of the same transaction, or from the same act of the person concerned. But we are of opinion that the incidents of imposition of penalty are distinct and separate and even if the offences are committed in the course of same transaction or arises out of the same act, the penalty is imposable for ingredients of both the offences. The h ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
