TaxTMI 
TaxTMI 
2022 (5) TMI 1397
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.... of box office collection. Such percentage varies from distributor to distributor, movie to movie and week to week after the release date. 3. The Department issued four show cause notices to recover service tax demand along with applicable interest and penalty: Serial No. Show Cause Notice Date Service Tax Demand (in Rs.) Period 1. 16.10.2014 1,55,04,957 01.04.2009 to 31.07.2013 2. 20.10.2014 1,26,69,145 19.08.2011 to 08.07.2013 3. 19.10.2015 40,36,40,938 01.04.2010 to 30.06.2012 4. 13.04.2016 5,93,67,163 01.01.2015 to30.03.2015 4. The demand raised in the third show cause notice amounting to Rs. 40,36,40,938/- was set aside and the demand raised in other three show cause notices was confirmed by the order dated 30.10.2018. Thus, an amount of Rs. 8,75,41,265/- has confirmed by the impugned order. 5. The appellant filed a reply to the show cause notice but the demand was ultimately confirmed by the Commissioner by order dated 30.10.2018. The Commissioner noted that the bone of contention was whether the arrangement between the appellant and the distributors would lead to constitution of an Association of Persons....
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....ipient relationship is established. In this connection reliance has been placed on the following decisions: (a) Mormugao Port Trust vs. Commissioner of Customs, Central Excise & Service Tax, Goa-(Vice-Versa) - 2016 (11) TMI 520- CESTAT Mumbai; (b) M/s. Old World Hospitality Limited vs. CST, New Delhi - 2017 (2) TMI 1176- CESTAT New Delhi; and (c) Delhi International Airport P. Ltd. vs. Union of India & Ors. -WP(C) 2516/2008 & CM No. 15832/2011 dated 14.02.2017; (iii) The impugned order to the extent it alleges that the appellant provided BSS to the distributors/or an unincorporated association of persons, therefore, deserves to be set aside; (iv) No service tax is payable in the absence of provision of any service by the appellant to the distributor/producer/unincorporated joint venture; (v) It is settled law that unless the authorities provide evidence to the contrary, an agreement is required to be read in a manner that it reflects the true intention of the parties as regards their respective roles and obligations; (vi) The Commissioner failed to appreciate that the essential parameters laid down for existence of a jo....
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....dules, managing distribution and logistics, customer relationship management services, accounting and processing of transactions, operational or administrative assistance in any manner, formulation of customer service and pricing policies, infrastructural support services and other transaction processing. Explanation.--For the purposes of this clause, the expression "infrastructural support services" includes providing office along with office utilities, lounge, reception with competent personnel to handle messages, secretarial services, internet and telecom facilities, pantry and security." (emphasis supplied) 10. It is made taxable under section 65(105)(zzzq) of the Finance Act which is reproduced below: "65(105)(zzzq) 'taxable service' means any service provided or to be provided to any person, by any other person, in relation to support services of business or commerce, in any manner; 11. The issue that arises for consideration is whether the activity carried out by the appellant would be exigible to service tax under BSS. To appreciate this, it would be pertinent to refer to the agreement. The agreement in the present appeal is almost t....
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....hat have been executed between the appellant and the distributors confer rights upon the appellant to screen the film for which the appellant is making payment to the distributors. The distributors are not making any payment to the appellant. Thus, no consideration flows from the distributors to the appellant for the alleged service. xxxxxxxxxxxx 18. It is not possible to accept the reasonings given by the Commissioner (Appeals) for confirming the demand of service tax under "renting of immovable property" for the simple reason that the appellant has not provided any service to the distributors nor the distributors have made any payment to the appellant as consideration for the alleged service. In fact, the appellant who has paid money to the distributors for the screening rights conferred upon the appellant. The Commissioner (Appeals) completely misread the agreements entered into between the appellant as an exhibitor of the films and the distributors to arrive at a conclusion that the appellant was providing the service of "renting of immovable property." (emphasis supplied) 14. Similar views were expressed by Division Benches of the Tribunal in The ....
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....ntributing some of the resources for the furtherance of the joint business activity. The Tribunal held that such public private partnerships meet the test laid down by the Supreme Court in Faqir Chand Gulati vs. Uppal Agencies Pvt. Ltd. - 2008 (12) STR 401, for ascertaining whether or not the arrangement is one of joint venture. The relevant observations of the Tribunal in Mormugao Port Trust are reproduced below: "12 .......................... In our view this arrangement in the nature of the joint venture where two parties have got together to carry out a specific economic venture on a revenue sharing model. Such PPP arrangement are common nowadays not only in the port sector but also in various other sectors such as road construction, airport construction, oil and gas exploration where the Government has exclusive privilege of conducting businesses. In all such models, the public entity brings in the resource over which it has the exclusive right, whether land, water front or the right to exploit the said land and water front, and the private entities brings in the required resources either capital, or technical expertise necessary for commercial exploitation of the res....
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....ces, which is a necessary ingredient of any taxable service is absent. 19. The Civil Appeal filed by the Department (Commissioner vs. Mormugao Port Trust) against the aforesaid decision of the Tribunal was dismissed by the Supreme Court both on the ground of delay as well as on merits and the judgment is reported in 2018 (19) GSTL J 118 (SC). 20. The Circular dated 23.02.2009 issued by the Central Board of Excise and Customs, infact supports the case of the appellant. The relevant portion of the Circular, which is in connection with service tax on movie theatres, is reproduced below: 2.4. The arrangement most commonly entered into between a theater owner and a distributor is that the theater owner screens the movie for fixed number of days under a contract. The proceeds earned through sale of tickets go to the distributor but the theatre owner receives a fixed sum depending upon the number of days of screening. In this arrangement, the advertisement and display of posters etc. is done by the distributor. Under this arrangement, the fixed amount contracted is given to the theater owner by the distributor irrespective of the fact whether the movie runs well or not. How....