SERVICE TAX ON LISENCE FEE RECEIVED BY THE MUNICIPAL CORTAION

[suhas phadke]

WHETHER SERVICE TAX IS APPLICABLE ON LISENCE FEE RECEIVED BY THE MUNICIPAL CORPORATION ( LOCAL GOVERMENT BODY) FOR ALLOWING ADVERTISING AGENCY TO PUT HIS KIOSK BOARD ? KEEP IN MIND FOLLOWING POINTS : AS U ALL AWARE THAT SERVICE TAX IS VALUE ADDED TAX AND WHEN CORPORATION RECEIVED LISENCE FEE THEN THERE IS NO VALUE ADDITION. SECONDLY CORPORTION DOES NOT CREAT A SPACE FOR ADVERTISEMTN. THE SPACE IS BEING CREATED BY THE ADVERTISING AGENCY. IF ANY BODY HAVE CASE LAW IN THIS MATTER. PL LET US KNOW. SUHAS PHADKE BARODA

AI Summary

Debate on Service Tax Applicability for Municipal License Fees on Advertising Spaces Under 'Selling of Space & Time' Rule. A discussion was initiated regarding the applicability of service tax on license fees received by a municipal corporation from an advertising agency for allowing kiosk board placements. The query highlighted that service tax is a value-added tax and questioned its applicability since the corporation does not create advertising space; it is created by the agency. A respondent clarified that while the fee is not classified as an advertising service, it might fall under the category of 'Selling of Space & Time for Advertisement.'