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2016 (4) TMI 454 - CESTAT NEW DELHI

2016 (4) TMI 454 - CESTAT NEW DELHI - 2016 (44) S.T.R. 105 (Tri. - Del.) - Liability of service tax - for the period April, 2003 to 13.07.2005 - Exclusive distributors of T.V. channels broadcast by the foreign broadcasters in India - Retained 15% of total subscription revenue collected through cable operators and MSOs and remitted the remaining revenue to the foreign broadcasters - Revenue contended that the respondent is not an MSO but a representative or agent for foreign broadcasters. - H .....

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e tax from 16.06.2005. Therefore, the charges recovered from the broadcasting agencies from MSOs or Cable Operators were not liable to service tax prior to 16.06.2005. - Decided against the revenue - Service Tax Appeal No.1596/2011-CU(DB) - Final Order No.51131/2016 - Dated:- 1-4-2016 - SMT. ARCHANA WADHWA, MEMBER (JUDICIAL) AND SHRI B. RAVICHANDRAN, MEMBER (TECHNICAL) For the Petitioner : Shri Sanjay Jain, DR For the Respondent : Shri B.L. Narsimhan, Advocate ORDER PER B. RAVICHANDRAN: This app .....

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te the channels; collect the subscription revenue; use channel marks and other promotional materials. The respondents retained 15% of total subscription revenue collected through cable operators and MSOs and remitted the remaining revenue to the foreign broadcasters. 3. Revenue entertained a view that the respondents were liable to pay service tax for the period April, 2003 to 13.07.2005, though the respondents have registered and paid service tax w.e.f. 14.07.2005. The case was adjudicated and .....

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p. It was contended in the appeal that the respondents are not covered by Boards letters dated 26.09.2005 and 9.6.2006. The Board s Circulars were with reference to the services provided by MSO which became chargeable to service tax w.e.f. 16.06.2005. The respondents were not acting as an MSO and hence, the Commissioner erred in dropping the demand. 5. We have heard both the sides and perused the appeal records. 6. Ld. AR mainly reiterated the points in the grounds of appeal. 7. Ld. Counsel for .....

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evenue, there appears to be a mis-appreciation of the facts to the effect that the respondents tax liability is being decided treating them as MSO. This is not correct. Ld. Counsel categorically stated that they are agents of foreign broadcasters and are rightly discharging service tax under such category all along. The amount collected from MSOs and cable T.V. Operators by the respondent are subjected to tax. He pleaded that the appeal by the Revenue is without merit. We find that the Original .....

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;Customs under their letters issued from F.No.345/5/2005-TRU dated 26th September, 2005 and F.No.149/5/2006-CX.4 dated 9th June, 2006. 3.3.2 The letter dated 26th September, 2005 was addressed to Director General (Service Tax), Mumbai and has been signed by Joint Secretary (TRU II). The letter dealt with the issue of charging service tax on amount collected from MSOs and cable TV operators by broadcasters for selling time slots (for advertisements) and the amount collected from MSOs and cable TV .....

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by broadcasters as subscription fee for allowing access to the paid channels, it was clarified that the amount collected by broadcasters as subscription fee for merely permitting the right to receive signal was subject to service tax only with effect from 16th June, 2005 when the definition of taxable service of broadcasting was amended and the amount collected from MSOs/cable operators by broadcasters for permitting right to receive signals was made taxable. 3.3.3 The letter bearing F.No.149/5 .....

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sed by the subordinate formation was that the term Broadcasting Charges that existed even prior to 2005 Budget, included the charges recovered by broadcasting agencies from MSOs or DTH, as broadcasting is a composite activity that include (a) dissemination (b) communication through electromagnetic waves and (c) receiving such signals disseminated. The term broadcasting charges , therefore, included subscription for receiving such signs traveling through electromagnetic waves. After examining t .....

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