TaxTMI 
TaxTMI 
2025 (11) TMI 1699
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.... that the respondent herein M/s Bigtree Entertainment Private Limited, Mumbai is inter alia, engaged in the business of providing services of booking of cinema tickets and event tickets through online mode by use of their website named as 'www.bookmyshow.com'. For the purpose of payment of service tax on taxable output services viz., Business Auxiliary Service (BAS), Information Technology services & Selling of space or time slots for advertisements falling under the taxable category of clause (zzb), (zzze) & (zzzm) respectively, of Section 65(105) of the Finance Act, 1994 and for compliance with Service Tax statute, they are registered with jurisdictional Commissionerate under service tax registration No. AABCB3428PST002. 2.2 During the disputed period from April, 2010 to March, 2014, the respondent had entered into agreements with various major cinema hall owners/ event holders such as Inox Leisure Ltd., PVR Ltd., Cinema Ventures Pvt. Ltd. etc. for providing online ticketing platform to enable general public for booking of movie tickets. The payments collected from the persons booking tickets were remitted to the cinema hall owners/event holders, who honour the admission of pe....
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.... of CCR of 2004. However, in adjudication of the case learned Commissioner focused predominantly on convenience fee and did not discuss about the structure of commission, discount etc. Further, the respondent retained the proceeds of ticket sales before remittance of same to the cinema hall owners/event organisers, which constitute additional commercial activity. Since the show cause proceedings were dropped in its entirety, without examining the above aspects, the impugned order is not sustainable and therefore he requested that the appeal filed by the Revenue may be allowed. 4.1 Learned Advocate appearing for the respondent submitted that the respondent has provided the services of online ticketing platform through which members of the general public can book cinema or other event tickets. The respondent had entered separate contracts into various cinema hall owners/event organisers as a booking agent. The terms and conditions of such agreement inter alia provide clearly that the respondent acts only as a booking agent, in selling the tickets on behalf of the cinema hall owners/event organisers and does not control the inventory or its availability, pricing. In respect of each....
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.... such an interface and book tickets online convenience fee is charged on them by the noticee and on this applicable service tax liability is discharged. In the case of events, normally the event holder is permitted to sell his inventory of tickets using noticee's portal, for which they get commission from the event holder and on the other hand the customer is provided the convenience of booking tickets for events through noticee's portal for which a convenience fee is charged on them. Applicable service tax, on both the commission as also convenience fee earned is discharged by the noticee. 67. Trading has been defined as "the business of buying and selling specially of commodities, securities, products and/or services". One of the basic requirements of 'Trading' is purchase and then sale (of tickets in this case). While it is evident that the noticee is facilitating the sale of their principal's tickets through their online platform, there is no evidence of any purchase, either in lot or any such pre-booking/blocking of tickets, either online or any such facility by way of a pre-agreement, so as to suggest trader-like preferences being meted out to the noticee. Neither ha....
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.... debit or credit card or through net-banking. The payments made by the customers comprises the cost of the tickets and the convenience fee. The cost of the ticket is remitted to the owner of the cinema hall or event organiser as they are the owner of the ticket. The noticee retains only the convenience fee which they received towards providing the service. The activity carried out by the noticee is standalone activity and by any stretch of imagination cannot be bisected into a service and trading activity. 71. In the SCN it has been alleged that noticee were involved in promoting and selling of tickets of the cinema owners/event holders. While in some paragraphs the notice seems to suggest that they were acting as agents of the cinema owner/event holder and causing sale of the tickets for them, whereas in other paragraphs it has been alleged that they have been resorting to trading of tickets online through their website. For reasons discussed above, the noticee cannot be said to be trading in tickets and they do not purchase and then sell the tickets and hence they are not agents of the cinema owners. They have been found to be discharging service tax on the amount ....
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.... xxx xxx xxx 76...... It is a settled law laid down by the Apex Court in the case of UOI V. Hindustan Zinc Ltd. reported in 2014 (303) E.L.T. 321 (S.C.) as also in C.Ex. V. Swadeshi Polytex Ltd. reported in 1989 (44) E.L.T. 794 (S.C.) that if an assessee could not have manufactured using a lesser quantity of inputs, even if some waste or byproducts arises in the manufacturing process, no credit of the inputs can be denied as the manufacturing activity could not have been undertaken using a lesser quantity of inputs. This ratio laid down by the Apex Court applies to the facts of the present case inasmuch as the noticee could not have effectively rendered the output service using a lesser quantum of input service. Noticee states that they have complied with the provisions of Rule 6(1) of CCR and have not availed any credit attributable to rendition of exempted services. Noticee has stated that all the services that they had availed of were used for rendition of taxable services and none of the services that they had availed of were used in the rendition of any exempted service, consequently the requirement under Rule 6(2) of CCR also stood complied with. xxx xxx xxx....
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.... input services and manufactures such final products or provides such output service which are chargeable to duty or tax as well as exempted goods or services, then, the manufacturer or provider of output service shall maintain separate accounts for- (a) the receipt, consumption and inventory of inputs used- (i) in or in relation to the manufacture of exempted goods; (ii) in or in relation to the manufacture of dutiable final products excluding exempted goods; (iii) for the provision of exempted services; (iv) for the provision of output services excluding exempted services; and (b) the receipt and use of input services- (i) in or in relation to the manufacture of exempted goods and their clearance upto the place of removal; (ii) in or in relation to the manufacture of dutiable final products, excluding exempted goods, and their clearance upto the place of removal; (iii) for the provision of exempted services; and (iv) for the provision of output services excluding exempted services, and shall take CENVAT credit only on inputs under sub-clauses (ii) and (iv) of clause (a) and input services un....
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.... Explanation III.-No CENVAT credit shall be taken on the duty or tax paid on any goods and services that are not inputs or input services." 8.1. As per above legal provisions, we find that Rule 6 of the CENVAT Credit Rules, 2004 deals with the obligations of a provider of taxable and exempted services. A plain reading of the above provisions indicates that while Rule 6(1) ibid provides that the manufacturer or provider of output service is not entitled for the credit of such quantity of input or input services which are used in the manufacture of exempted goods or exempted service except in the circumstances mentioned in the sub-rule (2) of the said Rules. Sub-rule (2) of Rule 6 ibid provides for maintenance of separate records in respect of inputs, input services substantiating use of input and input services for taxable and exempted goods or services. Sub-rule (3) of Rule 6 ibid provides that in case separate accounts are not maintained, the manufacturer or provider of services shall follow either of the conditions stipulated in sub-rule (3) of Rule 6 ibid. Further, Rule 6(2) ibid inter alia provides that if input services are used for provision of output services wh....
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....ry under Rule 6(3) ibid. 8.4 We have also examined the 'Ticketing Agreement' dated 24.12.2013 between the respondent and theatre owner INOX Leisure Limited for sale of tickets for viewing cinema in the theatres; and 'Sale of Tickets Agreement' dated 15.03.2015 entered into between the respondent and SUN TV Network Limited for sale of tickets for the event of cricket match in Twenty20 cricket tournament, which are placed on record. Clauses in the agreements clearly provide that the respondent has no rights of any access to the ticket inventory of INOX theatres and is providing only a ticketing platform; in the sale of every ticket to the customer, the respondent shall collect the base ticket price which shall be paid to INOX/SUN TV and convenience fee shall alone be allowed to be retained by the respondent. The obligations clause nowhere provide that the respondent can be permitted to do the trading activity of cinema theatre seats/event seats. Therefore, we find that the respondent had acted as per the said agreement while retaining the amount in respect of the services provided by them as convenient fee/commission and paid applicable service tax on those charges. We also find t....