Drishty Communication Private Limited Vs C.C.E. & S.T. (CESTAT Ahmedabad)
The appellants were engaged in providing services as advertising service to get customize and were registered “The Indian Newspaper Society” (INS). They were remitting 85% of the total amount received from their customers on getting space/time from media agencies or news papers or various publications. They were retaining the 15% of the remaining amount as their commission. The appellants were paying Service Tax on the said commission amount. A Show Cause Notice were issued to the appellant seeking to classify the service provided by them under definition “Advertising Agency Service” taxable service under Section 65(105)(e) of the Finance Act 1994.
CESTAT find that in the instant case M/s. Surya Publicity was providing Advertising Services to its client. M/s. Surya Publicity was not discharged any service tax liability as the same was liable for the levy of Service Tax. M/s. Surya Publicity was purchasing time and space in the newspaper / media companies through the appellant. The amount paid by M/s. Surya Publicity to the appellant for purchase of time M/s. Surya Publicity to the appellant for purchase of time and space was sought to be tax by revenue under the category of Advertising Service. It is seen that no evidence has been placed from record to establish that the appellant were providing “Advertising Agency Services.” The role of appellant was limited to being an intermediary in the sale of space/ time for media agency on commission basis.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
This appeal has been filed by M/s. Drishty Communication private Ltd. Against demand of Service Tax.
2. The appellants were engaged in providing services as advertising service to get customize and were registered “The Indian Newspaper Society” (INS). They were remitting 85% of the total amount received from their customers on getting space/time from media agencies or news papers or various publications. They were retaining the 15% of the remaining amount as their commission. The appellants were paying Service Tax on the said commission amount. A Show Cause Notice were issued to the appellant seeking to classify the service provided by them under definition “Advertising Agency Service” taxable service under Section 65(105)(e) of the Finance Act 1994.
Section 65 (3) of the Finance Act, 1994 which was inserted by the Finance Act, 1996 w.e.f. 01.11.1996 reads as under:
“advertisiong agency” means any person engaged in providing any service connected with he making, preparation, display or exhibition of advertisement and includes an advertising consultant;
w.e.f 01.05.2006, the term ‘person’ was substituted for the term ‘commercial concern’. The consequences of this changes are as follows:
