Tribunal rules in favor of cricketer: Service tax demand set aside, change in classification impermissible

The Tribunal held that the change in classification by the Commissioner (Appeals) from business support service to brand promotion service was impermissible. The impugned order demanding service tax on a cricketer's retainer fee was set aside as it exceeded the scope of the original notice. The appellant was found not liable for service tax as they were not providing any taxable services to the franchisee. The appeal was allowed in favor of the appellant-assessee.

---

---

Issues:
- Classification of service tax liability under business support service or brand promotion service
- Validity of the impugned order passed by the Commissioner (Appeals)

Analysis:
- The appeal was against an order upholding the service tax liability on the retainer fee received by a cricketer from a franchisee. The cricketer was alleged to be providing taxable services to the franchisee without paying service tax. The department issued a show cause notice proposing to demand service tax under business support service, which was confirmed by the original authority. However, at the appellate stage, the Commissioner (Appeals) changed the classification to brand promotion service, which was not part of the original notice. The appellant argued that this change was beyond the scope of the notice and contrary to binding precedent. The appellant contended that they were not providing any service to the franchisee, and the department misconstrued the agreement between them.
- The Tribunal, after hearing both parties and examining the records, found that the change in classification by the Commissioner (Appeals) was not permissible under the law. Citing various decisions in favor of the appellant, the Tribunal held that the impugned order was unsustainable as it went beyond the show cause notice. Therefore, the Tribunal set aside the impugned order and allowed the appeal of the appellant-assessee.

---