TaxTMI 
TaxTMI 
TaxTMI 
2026 (4) TMI 216
X X X X Extracts X X X X
X X X X Extracts X X X X
.... payments have been made to the Appellant. On perusal of the documents submitted by the Appellant, it is stated to have been found that the amounts have been received as consideration from Gemini TV on account of assignment of exclusive Telugu dubbing rights of the Tamil serial "Anandam", after duly dubbing into Telugu language. It is stated that on perusal of the assignment agreement it was found that the appellant had agreed to assign exclusive copy rights and all the ownership rights of all the episodes of the serial for a perpetual period to Gemini TV. It is stated that clause 7 of the agreement stipulated that the appellant shall undertake production work as directed by Gemini TV. It is also stated that the assignee was required to pay to the assignor a sum of Rs.10,000/- per episode and the said amount shall be paid for every five episodes after the telecast of the same and in the succeeding week. The Department was of the view that the said activity of production on behalf of others and assigning the copyright of the programme produced by the appellant to the broadcaster for a perpetual period, amounts to sale of programmes which was a taxable service covered under "Programm....
X X X X Extracts X X X X
X X X X Extracts X X X X
....usive copy right by the appellant with respect to the said serial to Gemini TV cannot be levied to service tax since there is a perpetual / permanent transfer which would amount to sale. Reliance is placed on the Final Order No.20823/2020 dated 10.11.2020 in Service Tax Appeal No.2017/2012 in the case of SKOL Broweries Ltd. vs. CCE and the decision in AGS entertainment Pvt Ltd v. UOI, 2013 (32) STR 129 (Mad). Ld. counsel further argued that as per the principles of classification given in Section 65A of the Finance Act 1994, the specific description would prevail for a general description. The Tribunal in the case of Dr.Lal Path Lab Pvt. Ltd. v. CCE, Ludhiana, 2006 (4) STR 527 has held that an item covered by a specific entry in a tax code cannot be taken out and tax under another entry. The said decision has been affirmed by the High Court of Punjab and Haryana as reported in the 2007 (8) STR 337 (P & H). 5. Ld. Counsel also argues that none of the ingredients required for invoking the extended period is present or has been invoked is neither present, nor has been invoked in the Show Cause Notice. The notice is for the period 2005-06 to 2007-08 and the Show Cause Notice was iss....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ayments from 01.04.2008 also, the appellant have failed to furnish the fact that the appellant had been producing the programme from 2005-06 for the broadcaster to telecast and had failed to pay the service tax dues thereon. The Adjudicating Authority therefore found that the extended period has been rightly invoked and a fit case for imposing penalty under Section 78 of the Act. The Appellate Authority has upheld the order of the Adjudicating Authority. The Appellate Authority too held that the appellant had undertaken production work of the said serial in Telugu from the 1st episode on behalf of M/s. Gemini TV. It was also found that the appellant had received a consideration of Rs.10,000/- per episode from M/s. Gemini TV. Hence it was held that the Appellant was liable to pay service tax on the charges collected towards the provision of service of production work of dubbing of Aanadam Serial in Telugu Language to M/s. Gemini T.V. The Appellate Authority also noticed a letter from M/s. Sun TV network, that was produced before the appellate authority, to the effect that they had made the payments to the appellant which is inclusive of all taxes. The Appellate Authority was therefo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ve copyright for Telugu Television Serial "AANANDAM" through various means and modes and the attendant rights and in the 4th clause states that the appellant assigns to M/s. Gemini TV to sole and exclusive right for the entire World as specified in clauses 1 and 3 for a perpetual period of 99 (Ninety Nine) years from the date of the agreement and the appellant permits M/s. Gemini TV to telecast the said Telugu Television Serial. The further clauses are seen to provide as under: "5. In consideration of the above the SECOND PARTY shall pay to the FIRST PARTY a sum of Rs.10,000/- (Rupees Ten Thousand Only) per episode of 22 minutes duration. The said amount shall be paid for every five episodes after the telecast of the same and in the succeeding week. The FIRST PARTY shall hand over the tapes from 1 episode onwards atleast three days prior to the date of telecast so as to enable the First Party to telecast the same every day i.e. Monday to Friday without any break from 15.03.2004 onwards. 6. The FIRST PARTY has handed over all the material including tapes in respect of all the episodes of the said serial to the SECOND PARTY and undertake not to exploit any part of t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....shall be at liberty to exploit the same. The SECOND PARTY will also be entitled to continue with the production and exploitation of the programme either directly or through third parties without any interference from the FIRST PARTY. 15 The FIRST PARTY undertake to provide and sign within the said period of this agreement any other documents as may be required by the SECOND PARTY in future to effectively carry out this agreement." xxxxxxxxxxxxxxxxxxxxxxxxxxxx 19. That this agreement is irrevocable and shall be in force till the expiry of the period mentioned herein. 20. The Agreement in all respects shall be subject to the jurisdiction of the courts of law in Chennai City only." 14. We are of the view that while the preamble of the said agreement, no doubt, contains terms assigning the exclusive copyrights and all ownership rights of all the episodes for a period perpetual. However, equally, the other recitals in the preamble as well as the terms that have been agreed upon, are also relevant for consideration and cannot be ignored. The agreement is seen to provide for both, the assigning of exclusive copyrights in perpetuity and also provides ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he program produced does not detract from the fact that the agreement equally contains clauses that required the appellant to undertake production work from 1st episode of the serial on behalf of M/s. Gemini TV. In such circumstances, we are of the considered view that the agreement cannot be viewed as one that pertains solely to assignment of copyrights so as to denude the Revenue from levying service tax in terms of the Finance Act, 1994 on the service rendered by the appellant to M/s. Gemini T.V., namely, the activity of production work that has been undertaken by the appellant, more so, when the terms of the agreement, including the per episode consideration specified is indicative of the said consideration being for the production work. 16. It would be apposite to notice that the Hon'ble Supreme Court has in its decision in Association of Leasing & Financial Services Companies v UOI, 2010 (20) 470 (SC), held that service tax is a tax on an activity. Thus, the taxable event is each exercise/activity undertaken by the service provider and each time service tax gets attracted. The Apex Court in the said decision has also found that the same view is reiterated broadly in the ea....
X X X X Extracts X X X X
X X X X Extracts X X X X
....in fact being produced by the appellant for telecast by the broadcaster from 2005-06, is therefore a deliberate act of wilful suppression of facts revealing the intent to evade payment of service tax that was due on the appellant's production work since 2005-06 under the taxable service as specified under Section 65(105)(zzu). 18. We have perused the decisions cited by the appellant and find that the Final Order No.20823/2020 dated 10.11.2020 in Service Tax Appeal No.2017/2012 in the case of SKOL Broweries Ltd. vs. CCE was in the context of permanent assignment of trademark/brand for a lumpsum amount of Rupees twenty crores three lakhs eighty thousand three hundred and twenty three only and the facts and circumstances are distinguishable from the facts of this case. The reliance placed on the decision in AGS Entertainment case of the Jurisdictional High Court was pertaining to challenge to the vires of the provisions of Section 65(105)(zzzzt) bringing within the ambit of service tax income generated from "temporary transfer or permitting the use or enjoyment of any copyright as defined in the Copyright Act, 1957. In para 76, a stray example of an assignment agreement in perpetui....