Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Commissioner of Service Tax-VI, Mumbai Versus Balaji Telefilms Ltd.

2016 (4) TMI 152 - CESTAT MUMBAI

Export of service - produced and distribution of television programmes Consideration received for taxable export service between April 2006 and March 2008 from M/s. SGL Entertainment Ltd., Hongkong - Export of Service Rules, 2005 - Contract between the two dating back to April 2006 for further distribution - Held that:- the reviewing authorities had, inappropriately, placed emphasis on the usage by the recipients of the programmes produced by the appellants. We find that the activity that is lia .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ubt that, if the programme producer or any other person were to further disseminate the programme to others, such dissemination would be liable for tax as a separate and distinct service. Consequently, the usage of the programme after delivery to the overseas entity is irrelevant in deciding upon the tax liability as 'programme producer'. By following the settled law, the contention of Revenue that the distinction should remain blurred is rejected. Therefore, the services rendered by the respond .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he conditions for export in Rule 3(2) of Export of service Rules,2005 have been complied with. - Decided against the revenue - Appeal No. ST/651/2010, Cross Objection No. ST/CO-13/2011 - Final Order Nos. A/86272-86273/2016-WZB/STB - Dated:- 9-9-2015 - M. V. Ravindran, Member (J) And CJ Mathew, Member (T) For the Appellant : Shri V K Singh, Special Counsel For the Respondent : Shri Badrinarayanan, Adv ORDER Per CJ Mathew Revenue is in appeal against Order-in-original no. 10/ST-11/KKS/2010 dated .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

aid contract, the assessee produced television programmes which were, admittedly, to be uplinked by the Hong Kong entity for the benefit of viewers. The case of Revenue was that the production of these programmes were taxable under Finance Act, 1994 since 2004 under section 65(105)(zzu), i.e., '(zzu) to any person, by a programme producer, in relation to a programme' With section 65(86b) defining a programme producer as "(86b) 'programme producer' means any person who produc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

)(zzu) of Finance Act, 1994. There is also no dispute that M/s SGL Entertainment Ltd had contracted with the respondent for production of programmes with intent for further distribution. Proceedings were initiated on 15th June 2009 to recover the tax liability that had allegedly not been discharged by the assessee who claimed that the consideration received from M/s SGL Entertainment Ltd was not taxable being realisations arising from export of 'programme production service'. Revenue con .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

used outside India; and (b) payment for such service provided outside India is received by the service provider in convertible foreign exchange.' With '(2) The provision of any taxable service specified in sub rule (1) shall be treated as export of service when the following conditions are satisfied, namely- (a) such service is provided from India and used outside India; and (b) payment for such service provided outside India is received by the service provider in convertible foreign exc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

'programme production service' to M/s SGL entertainment Ltd while the up-linking from Hong Kong by M/s SGL Entertainment Ltd for beaming to the distributors in India was in the course of rendering 'broadcasting service' taxable under section 65(105)(zk) of Finance Act, 1994; that the service rendered by the assessee being different from the service rendered by the overseas entity, it was held that the inference in the show cause notice that the destination of the service exported .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he adjudicating authority is in error and failed to appreciate that the programmes that were exported to Hongkong were beamed backed to India. This, in our considered opinion, is a fallacy that Revenue authorities, steeped as they are in the legacy of tax on 'visibles', are susceptible to. The reviewing authority appears to have ignored the fundamental aspect that the proceedings were initiated under Finance Act, 1994 and that the tax was sought to be levied on taxable services and any a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

hence likely to be deemed as export in 'colloquial' terms, argues that privilege of escapement from tax under Rule 4 of Export of Service Rules, 2004 is predicated solely upon fulfillment of the conditions in Rule 3(2) of the said Rules. Attention was drawn to the enunciation in 'Principles of Statutory Interpretation' [GP Singh, Thirteenth Edition p831] 'But equitable considerations are not relevant in construing a taxing statute and, similarly logic or reason cannot be muc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ative may, unintentionally, no doubt, have described the review proceedings which does not appear, prima facie, to find sustenance; except for the reference to the use to which the programme is put by the overseas entity, the review proceeding mirrors the show cause notice which had been considered at length and rejected in the impugned order. No substantive counter to the findings of the original authority have been adduced in the grounds of the appeal. Mere reiteration of the show cause notice .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e usage to which the output service has been put by the recipient of the service. Hence, their relevance to resolution of the dispute before us. Learned Counsel cites FIL Capital Advisors (India) Pvt. Ltd. vs. Commissioner of Service Tax, Mumbai - 2015-TIOL-795-CESTAT-MUM, AMP Capital Advisors Pvt. Ltd vs. Commissioner of Service Tax, Mumbai - I - 2015-TIOL-1001-CESTAT-MUM and Commissioner of Service Tax, Mumbai v Greater Pacific Capital Pvt. Ltd. - 2014-TIOL-1726-CESTAT-MUM. In these cases, tax .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

services had been delivered outside India. 11. At this stage, we would like to refer to our observation supra that the reviewing authorities had, inappropriately, placed emphasis on the usage by the recipients of the programmes produced by the appellants. We find that the activity that is liable to tax must be one which is specifically listed in section 65 (105) of Finance Act, 1994 and which, with reference to the business of the appellant is described in sub-clause (zzu). The appellant is a &# .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ly, the usage of the programme after delivery to the overseas entity is irrelevant in deciding upon the tax liability as 'programme producer'. In the decisions cited supra, Revenue had sought to blur the distinction between investment advice and investment itself- a contention that did not find favour with the Tribunal. In the present appeal. Revenue seeks to blur the distinction between the programme delivered abroad by the appellant and the subsequent broadcasting of that programme. We .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ere considered to have differing implications but the lack of difference has been articulated in the decision of this Tribunal in M/s Paul Merchants Ltd. vs. Commissioner of Central Excise, Chandigarh - 2012-TIOL-1877-CESTAT-DEL. A difference of opinion required resolution by reference to a Third Member but the evolution of the principle of not subjecting export of services to tax having been elaborately and exhaustively discussed in the lead decision that went on to prevail as the majority view .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

3.2 xxxxxxx The Appeal could have been disposed of by such brief observations and relying on the following decisions of the Tribunal namely ,- (i) Nipuna Services Ltd. v. Commissioner-2009 (14) S.T.R. 706 (ii) Muthoot Fincorp Ltd. v. CCE Vizag -2010 (17) S.T.R. 303 23.3 Instead we have given more elaborate arguments to reaffirm the finding in the above decisions with the hope that it will clear up the cob-web in the ideas relating to the issue of export of services and will help in deciding such .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version