HT Media Limited Vs Principal Commissioner Delhi South Goods and Service Tax (Supreme Court of India)
Supreme Court: Booking Foreign Speakers Is Not “Event Management Service”; Service Tax Demand on HT Leadership Summit Set Aside
The Supreme Court allowed the appeals filed by HT Media Limited and set aside the Service Tax demand confirmed under the category of “Event Management Service” in respect of fees paid to foreign speakers through overseas booking agents for the Hindustan Times Leadership Summit during the period October 2009 to March 2012.
The Court held that the essential ingredients of “event management service” under sections 65(40), 65(41) and 65(105)(zu) of the Finance Act, 1994 were not satisfied. On a close reading of the contracts, the Court found that the role of the booking agents was limited to booking speakers and arranging their appearance, including travel schedules and interaction terms. Such activity could not be equated with planning, promotion, organizing or presentation of the event itself.
Rejecting the Revenue’s contention, the Court clarified that the presence of speakers, though central to the Summit, does not amount to management of the event. Neither the speakers nor their booking agents could be regarded as “event managers”, as they did not manage the venue, logistics, publicity, stage arrangements or overall conduct of the Summit, as contemplated in the statutory definition and CBIC/TRU Circular dated 08.08.2002.
The Court emphasized the principle of strict interpretation of taxing statutes, holding that tax liability cannot be imposed by inference or by stretching statutory language beyond its clear contours. Applying both the statutory definitions and the common parlance test, it concluded that a contract for booking speakers is not commonly or legally understood as an event management contract.
While distinguishing its earlier ruling in International Merchandising Company LLC, the Court held that classification under “event management service” itself fails, and therefore the Service Tax demand could not survive.
Accordingly, the impugned CESTAT order was set aside and the appeals were allowed in favour of the assessee.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
