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

Service tax applicability on licence fees for advertising space: classification as selling of space and time may be determinative.
Whether service tax applies to licence fees charged by a municipal corporation for permitting advertising kiosks/boards, given arguments that the corporation effects no value addition and does not create the advertising space; a respondent suggests the fee may be classifiable as Selling of Space & Time for Advertisement, framing the matter as one of service classification rather than an established adjudicative result.