TaxTMI 
TaxTMI 
2025 (10) TMI 121
X X X X Extracts X X X X
X X X X Extracts X X X X
....pproval from the channel for the contents of the serial to be telecast and producing the serials. The television channels are charging telecast fee for the program. The channels also grant Free Commercial Time (FCT) to the Appellant who in turn sells such FCT' to advertising companies. 1.3 During the Audit of the accounts of the Appellant, it was noticed that Appellant had taken only the sponsorship fee as taxable value and had not paid Service Tax on telecast fee since the telecast fees received by the Appellant was paid to the Broadcasting Channel as per the invoice raised by the Broadcaster which would be inclusive of Service' Tax. The Appellant contended that the question of paying Service Tax by it would not arise in the case of Telecast fees' and contended that it was a revenue neutral situation as it collected the same amount charged by the broadcaster from the advertising agencies. 1.4 A SCN No. 127/2011 dated 04.04.2011 was issued demanding Service Tax for the period 18.04.2006 to 31.03.2010 under proviso to Section 73(1) of the Finance Act, 1994 along-with interest under section 75, and with a proposal for imposition of penalty under Section 76 and Secti....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the serial episode, the marketing agencies reimburses the telecast fees incurred by the Appellant. 4.4 Since the telecast fees charged by the TV Channel is per se reimbursed by the marketing agencies, the Appellant's sole consideration in this transaction is the proceeds of the free commercial time charges. On such proceeds, the Appellant had also discharged service tax under the Finance Act, 1994, and there is no dispute on this aspect. 4.5 The Appellant also paid service tax to the TV Channel on its receipt of the telecast services but had not availed CENVAT credit of such tax since, in respect of the telecast fees, by virtue of the reimbursement from the marketing agencies, considered itself as a pure agent. 4.6 Proceedings were initiated on the ground that the Appellant ought to have included the telecast fee reimbursed by the marketing agencies in its taxable value for the discharge of service tax. 4.7 Since the entire issue was revenue neutral in as much as the Appellant could avail CENVAT credit of the taxes paid to the TV Channel and use it to set off against the alleged liability on collection of amount as reimbursement from the marketing agency, it filed r....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on, as it stood at the relevant time it is clear that there is no usage of the words, or 'intent' in cases of fraud, collusion and suppression and such words are restricted only in cases of misstatement or other contraventions. This appears to be for the reason that the element of fraud, collusion and suppression, the legislature has perceived these acts as conscious acts and hence, any fraud, collusion or suppression could not be construed as one without any intent to evade duty. It is submitted that according to the Principles of Statutory Interpretation, the golden rule of interpretation of a statute is the literal rule of interpretation and that in a taxing statute, intendment or governing purpose has no role beyond what is stated in plain language. Reliance is placed on Hon'ble Supreme Court judgement dated 03.10.2024 in Civil Appeal No. 2948/2023 in the case of Chief Commissioner of Central Goods and Service Tax & Ors. Vs M/s. Safari Retreats Private Ltd. & Ors. 5.4 In view of the provisions of Section 78, the Statute interpreted literally, it is submitted that there is no escapement from levy of penalty under Section 78 of the Finance Act once it is a case of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....all, in addition to the duty, be liable to pay interest at such rate not below [ten per cent] and not exceeding thirty six per cent per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette, from the first date of the month succeeding the month in which the duty ought to have been paid under this Act, or from the date of such erroneous refund, as the case may be, but for the provisions contained in sub-section (2), or sub-section (2B), of Section 11A till the date of payment of such duty. Therefore, Section 11AB provides for interest on delayed payment of duty. Explanation (2) makes it clear this provision regarding interest on delayed payment of duty equally applies to the payment of duty under sub-section 2B of Section 11A. Therefore, whatever may be the reason for the delay in payment of duty and even in a case where duty is paid even before the issue of a show cause notice claiming duty under sub-section (1) of Section 11A once the duty is not paid on the due date, the liability to pay interest on such delayed payment of duty becomes effective automatically. In the scheme of the Act, no provision is made or no circumstances is ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....formed to the Department in any other manner. I find that in the instant case, the assessee was all-along aware of its liability to pay Service Tax on the 'Telecast fees' received, having collected the same with service tax component from its client, but yet the assessee neither paid the tax nor reflected such income in the statutory returns, thereby resorting to suppression of facts with an intent to evade payment of tax. As a result, the Department is justified in invoking the extended period of limitation....... 9.5 We find that time and again, it has been held by various courts including the Supreme Court that invocation of larger period is a draconian provision and has to be invoked with caution. This is a case of valuation involving interpretation of Statutes, where one cannot find any suppression/misstatement warranting invocation of larger period. 9.6 We find that Revenue has picked up the figures from the balance sheet and profit and loss account maintained by the Appellant. The balance sheet and profit and loss account have been held to be public documents by various decisions and it stands concluded that when the income arising from various activities stand....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ertent non-payment is to be met within the normal limitation period and the burden is on Revenue to prove allegation of wilful misstatement. The onus is not on the assessee to prove their bonafides. In the case of CCE v. Chemphar Drugs Liniments [2002-TIOL-266- SC-CX = 1989 (40) E.L.T. 276 (S.C.)], the Supreme Court held that something positive other than mere inaction or failure on the part of the assessee or conscious or deliberate withholding of information when assessee knew otherwise, is required before it is saddled with the liability of the extended period. 9.8 The issue involved in this appeal also relates to interpretation of law and revenue neutral situation. Either way, the Appellant does not stand to benefit from this issue and hence, no malafides can be attributed to them. We find that the Appellant has filed the original returns in time without inclusion of Telecast Fees; and on Audit Advisory, the Appellant has filed the revised ST-3 Returns before the issue of impugned order. Under these circumstances, we hold that invocation of extended period is totally not justified in this case. The decisions referred to above have clearly held that in such circumstances ther....