TaxTMI 
TaxTMI 
2007 (5) TMI 151
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.... covered under the category of advertising agencies. The Audit found that they had collected incentives front M/s. Malayala Manorama. The Revenue has considered these receipts as extra commission and had proceeded to recover Service Tax on these amounts by invoking larger period. In this case, by Stay order No. 881/2006 dated 25-8-2006, this Bench was pleased to grant waiver of pre-deposit following the ratio of earlier stay Order No. 476/2006 dated 17-5-2006 [2006 (4) S.T.R. 136 (Tribunal)] rendered in similar matter as in the case of M/s. Marketing Consultants & Agencies Ltd. v. The Commissioner of Service Tax. 4. The learned Chartered Accountant submits that the above cited case along with the case of M/s. Euro RSCG Advertising Ltd. v....
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....eproducing the said Annexure II mentioned in the Show Cause Notice: "ANNEXURE II" Details of cases where the service provider is receiving a lump sum amount from their client as agency fee every month and hence are not collecting commissions on Individual Invoices and therefore no service tax is paid on Individual bills Intel Print TV Others Bill @ net Bill @ Cross Commn. @ 15% ST Payable Up to May 03 0 0 0 0 0 0 0 From Jun 03 to Sep 04 160929754 108149442 2366691 271445887 319318102 47902215 3832177 From Oct 04 to Dec 04 23303363 44376045 1355000 69034411 81216954 12182543 1242619 ....
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....rvice tax due on such receipts is deposited. The evidences on record do not corroborate the contention of the assessee. Annexure II to the Show Cause Notice clearly mentioned that the assessee received retainership payment/agency fee to the tune of 6,52,27,619/- from their clients (up to May 03, from June 03 to Sep 04 and Oct 04 to Dec 04). The service tax liability on the aforesaid amount of agency fee/lump sum payment was computed to be Rs. 55,05,725/- and the assessee could not adduce any documentary evidence to substantiate their claim that the service tax amount due on such receipts had been duty paid. There is no evidence regarding payment of Rs. 55.05 lakhs (approx.) towards service tax during the aforesaid period. No evidence, has b....
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....g agency. Therefore such a person/organization who wants to avail the services of advertising agency becomes the client of the advertising agency. The advertisement can be done in various ways either through Print Media or through Radio or Television, etc. in order to fulfill the requirements of his client the advertising agency which is the service provider gets in touch with the appropriate media. In other words as far as the advertising agency is concerned, its client is not the media. In order to provide advertising services the advertising agency charges certain amounts from the clients. Such amounts are liable to service tax. With regard to the relationship between the advertising agency and the media, the advertising agency has to pa....
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.... these amounts have been received from the media. Since these amounts have not been received from the clients of the service provider (the appellants) there is no liability of service tax on these amounts. What is this cash discount? The appellants have stated that some of the publications request for their payments before the advertisements are released and have agreed discount on these advance payments. These discounts on the bills are received from the publications and not from the clients. Thus cash discount is an income from payment of bills in advance and not from services rendered to clients and does not attract service tax. In addition to this cash discount, the appellants received incentives from certain publications after they rea....