TaxTMI 
TaxTMI 
2008 (7) TMI 232
X X X X Extracts X X X X
X X X X Extracts X X X X
....service tax is on the charges collected by the appellants from such advertisers/sponsors. In the impugned order, the ld. Commissioner considered the appellants to be a "broadcasting agency or organization" defined under Section 65 (15) of the Finance Act 1994 and held that they had rendered "broadcasting service" to the advertisers/sponsors as a taxable service under Section 65(105)(zk) read with the first part of the definition of "broadcasting" given under Section 65 (14) of the Act as amended (16.7.2001). 2. 18 hours time per day was given to M/s. Vijay Television by the Broadcasting Company under an Agreement dt.1.8.2001. M/s. Vijay Television could get their programmes telecast during such hours by the Broadcasting Company. Out of the broadcasting time procured from the Broadcasting Company, M/s. Vijay Television allotted time slots to their own sponsors/ advertisers against payment of consideration. The Broadcasting Company had no control over such allotment of time slots made by M/s Vijay Television to the sponsors/advertisers. The programme selection and scheduling for the purpose of broadcasting were done in terms of agreements entered into by M/s Vijay Television with ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n any manner and, in the case of broadcasting agency or organization, having its head office situated in any place outside India, includes its branch office or subsidiary or representative in India or any agent appointed in India or any person who acts on its behalf in any manner, engaged in the activity of selling of time slots for broadcasting of any programme or obtaining sponsorships for programme or collecting broadcasting charges on behalf of the said agency or organization;" 3. The adjudicating authority has placed the appellants' activity under the first part of the definition of "broadcasting" under Section 65 (14) and has held that the programme selection and scheduling done by them for telecast thereof by the Broadcasting Company were covered by the definition. According to the appellants, the Broadcasting Company was the "broadcasting agency/organization", who had their office in India only. Their case is that they were not acting for a "broadcasting agency" having its head office outside India and, therefore, there was no question of selling of time slots or collecting broadcasting charges on behalf of such agency. Thus, according to the appellants, their activi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng charges on behalf of certain broadcasting companies, were held to have rendered "broadcasting service" and, consequently, they were held liable to pay service tax on the amount collected by them from advertisers/sponsors. 5. After giving careful consideration to the submissions, we find that the appellants have not made out any case on merits. The "Broadcasting Company' was engaged in the business of operating 'VIJAY' television channel and was registered with the department for providing "broadcasting service". M/s Vijay Television (appellants), under an agreement, purchased specific time slots from the "Broadcasting Company" against payment of monetary consideration. These time slots were used for the telecast of programmes which were got produced under agreements between M/s. Vijay Television and producers of TV serials and other programmes. M/s. Vijay Television prepared the schedules and decided the programmes to be telecast during the time slot. As per the definition of "broadcasting" as amended by the Finance Act, 2001, with retrospective effect from 16.7.2001, programme selection, scheduling or presentation of sound or visual matter on a television channel....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d by the appellants to their clients (sponsors/advertisers) was taxable. 7. The learned counsel has argued that the activities carried on by the appellants were specifically covered by a different category of taxable service under Section 65 (105) (zzzm) w. e. f. 1.5.2006 and that, since the pre-existing definition of "broadcasting agency or organization" remained the same beyond the said date, such activities were not covered by Section 65 (105) (zk) prior to that date. The new provision cited by counsel is the following: Section 65 (105) - Taxable service means any service provided or to be provided- (zzzm) to any person, by any other person, in relation to sale of space or time for advertisement, in any manner; but does not include sale of space for advertisement in print media and sale of time slots by a broadcasting agency or organization. Explanation 1. - For purposes of this sub-clause, "sale of space or time for advertisement" includes, - (i) providing space or time, as the case may be, for display, advertising, showcasing of any product or service in video programmes, television programmes or motion pictures or music albums, or on billboards, public places, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... SALE AGREEMENT) between the appellants and the Broadcasting Company was very much known to the department and, therefore, the Commissioner's finding of "suppression of facts with intent to evade payment of service tax" is not sustainable We have perused this Agreement. Article 2 1 of this agreement provided that programmes supplied to the Broadcasting Company would be telecast on the channel during the time slots on the basis of schedules to be decided by M/s. Vijay Television and communicated to the Broadcasting Company. Article 3.2 of the Agreement provided for "advertising entitlements" to be utilized exclusively by M/s. Vijay Television who could, at their discretion, sell time slots directly or through sales agents on such terms and conditions as agreed between M/s. Vijay Television and such sales agents. The same Article further laid down that invoices for sale of advertising air time from within the "advertising entitlement" on every programme telecast during the time slots shall be raised by M/s. Vijay Television and that the revenues from the same shall be exclusively to their account. Article 3.3 granted liberty to M/s. Vijay Television to determine and amend the rat....