Entertainment Tax in cable services requires factual verification before service tax inclusion; matter remanded for payment check.

Entertainment Tax collected in relation to Cable Operator Service was treated as requiring factual verification before it could be included in the service tax base. Although the demand had been confirmed because the tax was not shown separately in bills and supporting documents were not produced before the lower authority, payment particulars through bank records and challans were available. As the circular relied upon required separate disclosure for exclusion, the Tribunal held that actual payment to the government authority had first to be verified. The impugned order was set aside and the matter remanded to the original adjudicating authority for verification; if the tax had been correctly paid, the corresponding demand would not survive.

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Issues: Whether Entertainment Tax collected in relation to Cable Operator Service was liable to be included for service tax and, if the supporting documents had not been produced before the lower authority, whether the matter required remand for verification.

Analysis: The demand had been confirmed on the ground that the assessee had not shown Entertainment Tax separately in the bills and had not produced the relevant documents before the lower authority. It was found that payment particulars of Entertainment Tax through bank account and challans were available, though not fully placed before the original authority. The circular relied upon required separate disclosure in the bill for exclusion from service tax, but the existence of payment particulars meant the factual verification of actual payment had to be undertaken before deciding the taxability of that component.

Conclusion: The impugned order was set aside and the matter was remanded to the original adjudicating authority to verify the Entertainment Tax payment particulars, and if correctly paid to the government authority, the demand attributable to that amount would not survive.

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