TMI Blog2021 (8) TMI 1222X X X X Extracts X X X X X X X X Extracts X X X X ..... PF charges and service charges - HELD THAT:- In regard to convenience fees, pouring fees, parking fees and service charges, it was submitted that though the demand of service tax proposed in the show cause notice dated 21.04.2014 was under the category of renting of immovable property services, the impugned order has confirmed the demand under the category of support services of business . It was, therefore, submitted that the impugned order has gone beyond the show cause notice. In this connection, reliance was placed on a Division Bench decision of the Tribunal in M/S DELHI DUTY FREE SERVICES PVT. LTD. VERSUS COMMISSIONER CGST DIVISION, DELHI SOUTH COMMISSIONERATE [ 2019 (8) TMI 1489 - CESTAT NEW DELHI] . A perusal of the reply to the show cause notice filed by the appellant as also the additional written submissions clearly show that the appellant had made detailed submissions an each of these heads - the impugned order, to the extent it has confirmed the demand of service tax under these four heads is, therefore, liable to be set aside. Advertisement Income - HELD THAT:- The Principal Commissioner committed an error in confirming the demand under this head. Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cal exhibition rights for exhibition of the film were transferred to the appellant either temporarily (i.e. for specified number of shows and period) or in perpetuity, depending on the agreement between the parties. The appellant further claims that it is in exercise of such rights obtained from the Distributors, that the appellant exhibited the movies in its theatres. 4. In lieu of obtaining such rights, the appellant agreed to share a specified percentage of Net Box Office Collection [NBOC ] with the distributors, subject to other conditions specified therein in the agreements. In one agreement dated 10.05.2013 entered into between M/s. Eros International Media Limited and the appellant, the appellant agreed to share 50%/40%/30% of NBOC on week basis with M/s. Eros International Media Limited, subject to a minimum guarantee share of the distributor. 5. The Department, however, took a stand that the appellant was providing various elements of interconnected services to the Distributors, such as renting/letting/leasing of theatre for exhibition of films; manpower to manage the theatre operations, provision of projector and other related equipments to screen the films; arrangi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Service Charges 1794817/- 8. Advertisement Income 50064563/- 9. Foreign Exchange Expenses Incurred 1302142/- 10. VPF Charges 56120/- 11. Service tax already paid (-) 14409194/- TOTAL ₹ 33,45,17,923/- 8. The aforesaid show cause notices were adjudicated upon by the Principal Commissioner by order dated 30.11.2015. Out of the total demand of ₹ 33,45,17,923/- raised in the show cause notices, demand of ₹ 19,19,92,658/- for the period October 2008 to March 2014 was sustained. The computation of the same issue-wise is given in the following Table: Serial No. Nature of Amount Service Tax proposed in Show Cause Notices (in Rs.) Service Tax confirmed in the order (in Rs.) Demand dropped by the impugned order (in Rs.) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner of Service Tax, Delhi-I [ 2 020 (11) TMI 436 - CESTAT New Delhi ]; and d) M/s. Golcha Properties Pvt. Ltd. vs. Principal Commissioner of Service Tax, Delhi-I [2020 (11) TMI 137 - CESTAT New Delhi]; (ii) Demand of service tax on income under the heads convenience charges , pouring fees , other income , lease rent income , parking fees , VPF charges and service charges shown in the balance sheet is not sustainable. The impugned order has recorded that the appellant did not submit any reply to the first show cause notice dated 21.04.2014. The appellant had submitted a reply to the first show cause notice on 24.10.2014. The impugned order is, therefore, liable to be set aside on this ground alone; (iii) In so far as convenience fees, pouring fees, parking fees and service charges are concerned, the demand of service tax was proposed in the show cause notice dated 21.04.2014 under the category of renting of immovable property service. The impugned order has gone beyond the show cause notice by confirming the demand under the category of support services of business ; (iv) The demand on amount under lease rent has been confirmed under the category of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is issue. The said finding in the impugned order is incorrect as the appellant had filed a reply to the first show cause notice dated 21.04.2014 as is evident from Ground G of the reply; and (ix) The extended period of limitation could not have been invoked in the present case as the Department failed to point out any positive act of suppression on part of the appellant. Hence, the demand till September 2010 is time barred. 10. Dr. Radhe Tallo, learned Authorised Representative appearing for the Department has however, supported the impugned order and contended that it does not call for any interference in this appeal. Learned Authorised Representative pointed out that the intention of the parties as per the agreement agreed upon was hiring of theatres for screening of films which will fall under the category of renting of immovable property service. Learned Authorised Representative also submitted that since the appellant has stated that the reply to the show cause notice dated 21.04.2014 was not considered by the Principal Commissioner for the reason that the reply had not been submitted, the matter can be remanded to the Principal Commissioner to examine the reply an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant enters into agreements with the film distributors to obtain such copy rights under which the right to exhibit the films is transferred to the appellant, either temporarily or in perpetuity, depending upon the nature of the agreements between the parties. xxxx xxxx xxxx 11. It is more than apparent from a bare perusal of the aforesaid agreements that they have been entered into between the appellant as an exhibitor and the distributors for screening of the films on the terms and conditions mentioned therein. The payments contemplated under the terms and conditions either require the exhibitor to pay a fixed amount or a certain percentage, subject to minimum exhibitor share or theatre share of effective shows in a week. xxxx xxxx xxxx 16. It is very difficult to even visualize that the appellant is providing any service to the distributor by renting of immovable property or even any other service in relation to such renting. The agreements that have been executed between the appellant and the distributors confer rights upon the appellant to screen the film for which the appellant is making payment to the distributors. The distributors are not making any payment to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8-09 to 2013-14. The impugned order has confirmed the demand of service tax on the amount shown by the appellant under the aforesaid heads. 18. Learned counsel for the appellant submitted that though the impugned order mentions that the appellant had not submitted any reply to the first show cause notice dated 21.04.2014, but the appellant had submitted a reply to the show cause notice on 24.10.2014. In this connection, learned counsel placed the copy of the reply, which is at page 499 of the Appeal Memo. 19. The endorsement contained in the reply at page 499 does show it was received on 21.10.2014. It is also seen that additional written submissions were filed by the appellant to the show cause notice dated 21.04.2014 and in paragraph J.1 it was specifically stated that a reply to the said show cause notice dated 21.04.2014 was filed by the appellant on 21.10.2014 and filing of the additional written submissions to the first show cause notice dated 21.04.2014 has been acknowledged in the impugned order. It is, therefore, clear that the appellant had submitted a reply to the show cause notice dated 21.04.2014 on 21.10.2014, but the Principal Commissioner failed to consider it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... everages. 18. In Nestor Pharmaceuticals Ltd. a Division Bench of the Tribunal observed that the Commissioner (Appeals) cannot go beyond the scope of the show cause notice and that no matter can be decided on a ground other than the grounds raised in the show cause notice and for this reason the impugned order was set aside. In Tata Johnson Controls Automotive a Division Bench of the Mumbai Tribunal observed that it was not open to the Commissioner (Appeals) to make out a new case in the order passed by the Commissioner and, therefore, the Order passed by the Commissioner (Appeals) deserved to be set aside on this ground alone. 24. Learned counsel for the appellant also submitted that the finding contained in the impugned order that the appellant had not made any submission on these issues is factually incorrect as the appellant had made detail submissions as to why service tax could not be demanded under this head. 25. A perusal of the reply to the show cause notice filed by the appellant as also the additional written submissions clearly show that the appellant had made detailed submissions an each of these heads. 26. The impugned order, to the extent it has confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... butor towards the purchase of digital cinema projection equipment for use by a film distributor in the presentation of first release motion pictures and this is paid in the form of a fee per booking of a movie. Learned counsel pointed out that service tax on this amount was deposited and the same has also been acknowledged in paragraph 10.4 of the impugned order. 32. The service tax has been deposited on the income generated under this head. The demand, therefore, could not have been confirmed on an assumption that service tax had not been paid. Advertisement Income 33. The impugned order records that the appellant did not make any submission on this issue with regard to the first show cause notice dated 21.04.2014. 34. The submission of learned counsel for the appellant is that detail submissions were made in the reply filed to the show cause notice in Ground F, but they have not been considered. Learned counsel also pointed out that service tax for the period 01.07.2012 to 31.03.2013 has been set aside in paragraph 8.3 of the impugned order and for the period 2008-09 to 30.06.2012, service tax was paid by the appellant. This fact was stated in the reply to the show ..... X X X X Extracts X X X X X X X X Extracts X X X X
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