TaxTMI 
TaxTMI 
TaxTMI 
2024 (4) TMI 679
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....t to such screens under the brand name of "Silver Cities Cinema". Thus, the appellant is engaged in providing the services of screening of film supplied by the film distributor. Department relied upon the Board Circular No. 109/03/2009 dated 23.02.2009 wherein it has been clarified that the activity of screening of film supplied by a film distributor would fall under the taxable category either of "Renting of immovable property" or "Business Support Services" depending upon the arrangement between the film distributor and the theatre owner. The Circular applies even to the arrangements being Principle to Principle basis. 2. Based upon the Agreement executed by the appellant with the distributor, department formed an opinion that the appellant is engaged in providing Renting of Immovable Property Service to the distributors and has received total amount of Rs. 24,29,45,450/- from them as shown in their profit and loss account. Resultantly, vide Show Cause Notice No. 48/2015 dated 09.02.2016, Service Tax amounting to Rs. 1,57,55,155/- alongwith proportionate interest and appropriate penalties is proposed to be recovered from the appellant. The said proposal has confirmed vide Order-....
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....tive has relied upon the decision of Hon'ble Madras High Court in the case of Ages Entertainment Pvt. Ltd. vs. Union of India 2013 (32) STR 129 (Mad.). With these submissions, the order under challenge is prayed to be set-aside and the appeal of the Department is prayed to be allowed. 6. While rebutting these submissions, Learned Counsel for the Respondent-Assessee has mentioned that the show cause notice as well as the order-in-original has no discussion about the nature of impugned activity done by the appellant nor there is any mention of reasons of taxability of the appellant's activity under "Business Support Service". The show cause notice itself is therefore vague. The findings based thereupon have rightly been set-aside. It is mentioned that the appellant has recorded its revenue from exhibition of film under heading "Sale of Cinema Tickets (Audi Receipts)" and the amount paid to the film distributor has been shown as purchases of traded goods under sub-head "Film Purchases Account". It is clear to show that the appellant is earning revenue from its audience against activities of exhibition of movies for them in return of a fee which is not subject to service tax. The acti....
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.... be licensed hereunder. Runs of the film shall commence from the first run the exhibitor commences the exhibition of the film till the end of the first run which shall be continuous. The distributor's share in mentioned in Column 2 in the first para of the agreement which is generally a percentage of the NBOC (Net Box Office Collection)." The bare perusal, makes it clear that there is no service as such which has been provided by the appellant to the distributors. The appellant has agreed for exhibiting the distributor's film without any interference of the said distributors. The distributors had actually granted licence to exhibit the theatrical exihibition rights of the film in the lincesed theatre. 9. As far as the time and number of shows are concerned, the distributor has agreed for getting share in the Revenue collected from the sale of the tickets that to within 10 days of completion of every week to which it pertains. The agreement clarifies that it is the transfer of copyright by the distributor in favour of the appellant to the exclusion of all including the owner of the said copyright. 10. The issue is otherwise no more res-integra. Following decisions have cla....
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.... was the appellant who had paid money to the distributors for the screening the rights conferred upon the appellant. The observations of the Bench are as follows : " 11. It is more than apparent from a bare perusal of the aforesaid agreements that they have been entered into between the appellant as an exhibitor and the distributors for screening of the films on the terms and conditions mentioned therein. The payments contemplated under the terms and conditions either require the exhibitor to pay a fixed amount or a certain percentage, subject to minimum exhibitor share or theatre share of effective shows in a week. xx xx xx 16. It is very difficult to even visualise that the appellant is providing any service to the distributor by renting of immovable property or even any other service in relation to such renting. The agreements that 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. xx xx xx ....