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2018 (2) TMI 331
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....tele serials produced by them and also has not discharged correct service tax by arriving the taxable value of services in a wrong manner. It was also noticed that the appellants have wrongly availed credit on input services. Show cause notice was issued raising the above allegations which after due process of law, confirmed the demand of tax, interest and imposed penalties. Aggrieved, the appellants are before this Tribunal. 2.1 On behalf of the appellant, Ld. counsel Shri V.S. Manoj submitted that the demand is raised on three main allegations raised in the show cause notice which are (i) The amount received for transfer of copyright of programmes to various TV channels amounts to service under the category of "TV or Radio Programme Pr....
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....llectual Property Right (IPR) was not subject to levy of service tax. Even after the said activity became taxable under the category of "Intellectual Property Service", it excluded the temporary transfer of copy right. 2.3 On the second issue that the appellant has not discharged service tax on all three segments namely fixed cost, variable cost and profit sharing, the ld.counsel submitted that this allegation is factually incorrect; that in the reply to show cause notice itself, the appellant has stated that they have discharged service tax on all the components. 2.4 The third allegation is that appellant has wrongly availed cenvat credit of service tax paid on telecast charges. The telecast charges were paid to the broadcaster for t....
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....received is classifiable under the category of "Programme Production Service" and not under "Intellectual Property Right Service". The levy of service tax on the consideration received from broadcaster under copy right assignment agreement has been rightly subjected to levy of service tax. 3.2 On the second issue, she submitted that as per the agreement entered with advertising agencies the appellant received the charges under three heads namely variable cost, fixed cost and profit share. The variable cost represents the cost of production of programme, fixed cost represents telecast fees payable to the broadcaster for the slot allotted to the appellant and profit sharing is sharing of revenue earned from free commercial time between app....
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....erson, by a programme producer, in relation to a programme". "Programme Producer" as defined under Sec.65 (86b) means "any person who produces a programme on behalf of another person" and "programme" is defined under Sec.65 (86a) as "any audio or visual matter, live or recorded, which is intended to be disseminated by transmission of electromagnetic waves through space or through cables intended to be received by the general public either directly or indirectly through the medium of relay stations." Section 65 (86b) as shown above indicates that 'Programme Producer' is a person who produces a programme on behalf of another person. In the present case, the department has no case that appellants are producing programme for any othe....
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....hence, they cannot be considered as programme producer in terms of Section 65 (86b) of the Act. Even otherwise these are copy right materials and if at all to be subjected to service tax, the same will apply only w.e.f. 01/07/2010. The learned counsel also contested the proceedings on limitation and on imposition of penalties considering the interpretation involved with reference to actual exports undertaken by the appellant only with reference to the nature of receipt of consideration from UK. ..... .... ..... 12. On the second issue, a plain reading of the statutory definition for programme producer service makes it clear that such programme producer should produce programmes on behalf of another person. In the present c....
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.... agency. In consideration of telecasting their programme, the appellant receives free time slots from the broadcasting agency. Using this free time slot, the appellant generates revenue by indulging in 'Sale of space or time for Advertisement' services. The Revenue alleges that service tax paid on telecast fees cannot be considered as input service for the output service of programme producing service and 'sale of space or time of advertisement' services. We are afraid that we cannot concur with this view made by the Ld. A.R. Without telecasting programmes, the appellant will not get the free time slots. Without obtaining the free time slots appellant will not be able to provide output service of 'Sale of space or time f....