1. This appeal has been directed by the Revenue against the impugned order-in-appeal vide which the Commissioner (Appeals) has modified the order-in-original of the adjudicating authority who confirmed the demand of Rs. 78,285/- under Section 68 of the Service Tax Act against the respondents with penalty of Rs. 100/- per day under Section 76, by reducing the demand to Rs. 2,985/- and setting aside the penalty.
2. None has come present on behalf of the respondents. The notice for today's hearing was sent to them on 6-5-2004, but no response has been received. No request for adjournment has been also received from them.
Therefore, I proceed to decide the appeal on merits after hearing the learned JDR.3. The facts are not much in dispute. The respondents are advertising agency registered under Section 69 of the Finance Act, 1.994. They had let out a portion of the site which they took from the Municipal Corporation for advertising purposes to other companies namely, M/s.
Ogilvy & Mather Ltd., M/s. Pioneer Publicity Corpn., New Delhi and M/s.
Punjab Advertising Co., Ambala, for that very purpose. The adjudicating authority confirmed the demand by holding that the case of the respondents was covered under Section 68 of the Act and as such they are liable to pay the Service Tax. The learned Commissioner (Appeals) has reversed that order by holding that by sub-letting of a portion of the site by the respondents which they had taken from the Municipal Corporation, did not amount to providing of any service by them within the four corners of Section 68 of the Act. But he has lost sight of the definition of 'Advertising Agency' which the respondents are, while deciding the matter. The definition of 'Advertising Agency' as provided under Section 65(3) of Chapter V of the Finance Act is "Advertising agency means any commercial concern engaged in providing any service connected with the making, preparation, display or exhibition of advertisement and includes an advertising consultant". The respondents are admittedly an advertising agency. They have provided space to the other advertising companies for the purpose connected with the advertisement and are charging consideration in lieu thereof from those companies. Therefore, it is not a case of mere sub-letting of a site, but it is a case where the respondents had provided service by way of letting them the site which is connected with the advertisement. It is also evident even from the record that they have raised bills against two companies, namely, M/s. Pioneer Publicity Corpn. and M/s. Punjab Advertising Co., but still did not discharge the service tax liability in respect of those bills. The Commissioner (Appeals) has even confirmed the service tax in respect thereof. But he could not use a different yard stick in respect of the other companies to whom the appellants had extended the service for displaying of the advertisement. Therefore, the impugned order of the Commissioner (Appeals), in my view, being contrary to the law, cannot be sustained and is set aside. The respondents are liable to pay the service tax as demanded in the show cause notice along with interest and penalty in terms of the order-in-original, which is restored.