TaxTMI 
TaxTMI 
2010 (11) TMI 211
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.... section 76 and Rs. 7,000 [at the rate of Rs. 1,000 per return] under section 77 of the Finance Act, 1994. 2. Appellant is engaged in the purchase and sale of time slots from electronic media channels to various advertising agencies on commission basis. The registration obtained by them from service tax department was subsequently surrendered. Their premises were visited by the officers on 22-12-2004, who conducted various checks and verifications. Statements of various persons including that of the Director were recorded. 3. As a result of investigations made by the revenue, it was revealed that appellant is a Private Limited Company engaged in providing sale of time slots for advertising services. As per depositions made by S....
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....gencies for the purpose of exhibiting the advertisement during those time slots. The said activities undertaken by the appellant have been held to be as 'advertising services'. 6. For better appreciation, we reproduce the definition of advertising service as contained in section 65(105)(e), as also of, the terms Advertisement, Advertising Agency, as appearing in the Finance Act, 1994 :- "Advertising Service - Any service in relation to advertisement in any manner connotes a very broad meaning to the term 'Advertising Services'. To ascertain the further scope of taxable advertisement services, meaning and import of the terms 'Advertisement' and 'Advertising Agency' need to be understood. The definitions of the above said ....
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....x. 7. The Commissioner has also dealt with the appellant's contention that the service of purchasing and selling of time slot was introduced for the first time with effect from 1-5-2006 and, as such, it has to be held that the said service was not covered by any other prior service. She has observed that inasmuch as providing space to the other advertising companies for the purpose connected with the advertisements are covered by the definition of advertising, carving out a new service from 1-5-2006 will not make much difference. Mere insertion of new section 65(105)(zzzm) introducing sale of space or time for advertisement other than print media, will not help the appellant to remain out of the coverage of section 65(105)(e) prio....
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....ng the time slots. It was in no way connected with making, preparation, display or exhibition of advertisements. The Tribunal in the case of Prithvi Associates v. CCE [2005] 2 STT 149 (Mum. - CESTAT), while upholding the said appellant's liability to service tax where the readymade advertisements received from the Government departments were being displayed by it on the back side of specified buses, has observed in Para 11 as under :- "11. . . The appellants have also contended that in some of the cases, they were only hiring the space and providing the same to the Government agencies, who were themselves displaying the boards, etc. on such space. We agree with the learned advocate that in such a case, the activity of hiring the s....
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...., selling the time allotted to a producer does not fall within the purview of "advertisement service" since this activity is not connected to making, preparation, display or exhibition of advertisement. This is akin to providing space in a newspaper or magazine for publishing an advertisement and has nothing to do with actual presentation of the advertisement." From the above, it becomes clear that the sale of time slot to electronic media cannot be termed as advertising services. 11. We also find favour with the appellant's contention that services were introduced for the first time with effect from 1-5-2006 under the category of "Sale of Space or Time for Advertisements". The Tribunal in the case of Board of Control for Cricket ....
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.... is held that the activity of sponsorship and sale of space were covered under the earlier heading of advertising agency, the same would lead to the redundancy of new legislation and would defeat the legislative intent." 12. There is no dispute that the said service of sale and purchase of time slot for advertising was introduced for the first time with effect from 1-5-2006. With such new introduction, it has to be held that the peculiar services were not covered by the definition of any other service prior to the said date. As observed in the case of BCCI, to hold otherwise, would negate the legislative intent and would make the new entry as otiose. 13. In view of the above foregoing discussions, it had to be held that ....