Custom, Excise & Service Tax Tribunal
M/S. New Rising Promoters Pvt. Ltd. Now ... vs Kolkata South on 5 August, 2025
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
EASTERN ZONAL BENCH : KOLKATA
REGIONAL BENCH - COURT NO. 1
Service Tax Appeal No. 75256 of 2024
(Arising out of Order-in-Original No. 37/COMMR/CGST & CX/Kol-North/2023-24 dated
01.11.2023 passed by the Commissioner of C.G.S.T. & C.X., Kolkata South, G.S.T.
Bhawan, 180, Rajdanga Main Road, Shantipally, Kolkata - 700 107)
M/s. Crescent Power Limited : Appellant
[Formerly 'M/s. New Rising Promoters Private Limited', now
merged with M/s. Crescent Power Limited']
6, Church Lane, 1st Floor,
Kolkata - 700 001
VERSUS
Commissioner of C.G.S.T. and Central Excise : Respondent
Kolkata South Commissionerate,
G.S.T. Bhawan, 180, Rajdanga Main Road, Shantipally,
Kolkata - 700 107
APPEARANCE:
Shri Arvind Baheti, Chartered Accountant, for the Appellant
Shri S. Dey, Authorized Representative, for the Respondent
CORAM:
HON'BLE SHRI ASHOK JINDAL, MEMBER (JUDICIAL)
HON'BLE SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL)
FINAL ORDER NO. 77194 / 2025
DATE OF HEARING / DECISION: 05.08.2025
ORDER:[PER SHRI ASHOK JINDAL] The appellant is in appeal against the impugned order wherein a demand of Rs.84,94,235/-, along with interest and penalty, has been confirmed against them for the period 2016-17.
2. The facts of the case are that M/s. New Rising Promoters Pvt. Ltd., presently merged with M/s. Crescent Power Ltd., (hereinafter referred to as "appellant"), holding Service Tax registration AADCN4741MSD001, was granted the franchisee rights for managing the team Rising Pune Supergiants Page 2 of 21 Appeal No.: ST/75256/2024-DB (RPS) by the Board of Control for Cricket in India (BCCI) for IPL season against a payment of management fees.
2.1. Under tripartite Stadium Agreements (hereinafter referred to as "agreements"), the State Cricket Associations, namely Maharashtra Cricket Association (MCA) and Andhra Cricket Association (ACA), who owned and operated the cricket stadiums in their respective states, conferred upon BCCI and the appellant the exclusive right and licence to access and use the stadiums during the IPL season for matches and practice sessions, in terms of the said agreements. In consideration of the services rendered by the State Cricket Associations, both BCCI and the appellant paid Rs. 30,00,000/- each, as per Clause 5.2 of the agreement. Further, under the agreements, the appellant was obligated to issue complimentary match tickets to BCCI and the respective State Cricket Associations, as per Clause 4.3. therein.
2.2. During FY 2016-17, the appellant issued 20,128 complimentary tickets at Pune and 20,832 at Visakhapatnam free of cost to BCCI and State Associations, in compliance with contractual obligations.
3. On the basis of a Departmental audit initiated on 27.12.2017, a Show Cause Notice bearing C. No. V (8)48/SCN/CGST & CX/Kol Audit-
1/Tech/NRPPL/Kol/18-19/595 dated 03.07.2020 was issued under the proviso to Section 73(1) proposing recovery of service tax of Rs. 6,30,90,335/- (inclusive of cess), along with interest and penalty, alleging that the issuance of complimentary match tickets amounted to a declared service under Section 66E(e) of the Finance Act, 1994.
Page 3 of 21Appeal No.: ST/75256/2024-DB
4. The matter was adjudicated and vide the Order- in-Original No. 37/COMMR/CGST&CX/Kol- North/2023-24 dated 01.11.2023 (hereinafter referred to as the "impugned order"), the ld. adjudicating authority re-quantified the demand to Rs. 84,94,235/- in respect of 26,340 complimentary IPL match tickets, along with applicable interest and imposed an equivalent amount of penalty under Section 78 of the Act.
4.1. Against the said order, the appellant is before us.
5. The contentions raised by the Ld. Counsel appearing on behalf of the appellant inter alia are as follows: -
A. There was no declared service, as alleged, at all by the appellant to the BCCI/State Cricket Association. The Ld. Adjudicating Authority has passed the impugned order without considering the relevant circular and judicial precedents in existence at the time of passing of the order.
(i) Reference has been drawn to Circular No. 214/1/2023-S.T. dated 28-02-2023, whereby it has been clarified that the activities contemplated under section 66E(e) of the Finance Act are the activities where the agreement specifically refers to such an activity and there is a flow of consideration for this activity. It has also been stated that the contents of Circular No. 178/10/2022-GST dated 03-08-2022 may also be referred to in this regard. Therefore, in accordance with the abovementioned circulars, for an activity to fall Page 4 of 21 Appeal No.: ST/75256/2024-DB within the ambit of Section 66E(e), there must be:
i. Two identifiable parties,
ii. An agreement wherein one party
expressly or impliedly agrees to do, tolerate, or refrain from an act; and iii. A flow of consideration from the other party for such agreement.
(ii) In the absence of such an independent contractual arrangement, the provisions of Section 66E(e) cannot be attracted.
(iii) This position has also been upheld in multiple judicial precedents, such as:
• South Eastern Coal Fields Ltd. v. CCE, Raipur [2021(55) G.S.T.L. 549(Tri. - Del.)] • Steel Authority of India Ltd. v. Commr of GST & C.E., Salem [2021 (55) G.S.T.L. 34 (Tri. - Chennai)] • Neyveli Lignite Corporation Ltd. [2021 (53) G.S.T.L. 401 (Tri. - Chennai)] • Western Coalfields Ltd. v. Commr of GST & C.E. [2022 (9) TMI 741 - CESTAT MUMBAI] • General Manager (TR) and M/s. Bharat Sanchar Nigam Limited v. Pr. Commr. [2025 (4) TMI 107
- CESTAT CHENNAI]
(iv) In the present case, it is evident that there is no independent contractual arrangement whereby the Appellant agreed to "tolerate an act" or "refrain from doing an act" against any separate consideration. The issuance of complimentary tickets arises only as an incidental obligation Page 5 of 21 Appeal No.: ST/75256/2024-DB under the agreements for IPL operations and does not represent a distinct service activity.
Further, no consideration was received from BCCI, State Associations, stakeholders, or sponsors for issuance of such tickets, which is a sine qua non for levy under Section 66E(e).
(v) It is pointed out by the appellant that the impugned order fails to identify the specific recipient of the alleged service. The impugned order merely records that the Appellant issued complimentary match tickets to BCCI, MCA and ACA and, on that basis, concludes that the appellant displayed an act of forbearance by tolerating spectators who were allowed free access to the stadium, while other spectators had to pay for entry.
(vi) It is submitted that the definition of "service"
under Section 65B(44) of the Act requires an activity carried out by one person for another for consideration. Moreover, as clarified in Circular No. 214/1/2023-S.T., for a service to be taxable under Section 66E(e), there must be two clearly identifiable parties--a provider and a recipient--linked by an agreement and consideration. The reasoning in the impugned order demonstrates that even the Ld. adjudicating authority has not conclusively identified who the alleged service recipient is, thereby failing to satisfy this fundamental condition for taxability. Accordingly, there is no identifiable service recipient who pays consideration and thus it fails the basic test of "service."
Page 6 of 21Appeal No.: ST/75256/2024-DB
(vii) Hence, in light of the above circulars and judicial pronouncements, the reliance on Section 66E(e) in the impugned order is wholly misconceived and unsustainable in law.
B. The valuation methodology adopted by the Department is fallacious and not sustainable.
(i) Under Section 67 of the Finance Act, 1994, service tax is chargeable only on taxable services provided for a consideration. The Explanation to Section 67 further clarifies that "consideration" includes: (i) any amount payable for taxable services provided or to be provided, (ii) reimbursable expenses charged during service provision and (iii) amounts retained by lottery distributors or selling agents. Moreover, Section 67(4) expressly provides that valuation is to be determined as prescribed subject to the provisions of Section 67, meaning valuation rules cannot override the primary requirement of "consideration."
(ii) It is submitted that the reliance on Rule 3(a) of the Service Tax (Determination of Value) Rules, 2006 by the Ld. Adjudicating Authority is misplaced. It is submitted that this Rule applies only where there is a service rendered for a consideration, but the value is not ascertainable. In the present case, there is complete absence of consideration, rendering Rule 3 inapplicable. Reliance in this regard is placed on the decision in the case of M/s. Hewlett Packard India Sales Private Page 7 of 21 Appeal No.: ST/75256/2024-DB Limited v. Commr of C.Ex. [2024 (1) TMI 679
- CESTAT BANGALORE], wherein it was held that in the absence of consideration, applying Rule 3 to impute a notional value is a misinterpretation of the concept of levy of service tax.
(iii) Further, it is a settled principle that consideration is a sine qua non for service tax levy. Reliance in this regard is placed on the following:
• Commissioner of CGST and C. Ex. V. Edelweiss Financial Services Ltd. [(2023) 5 Centax 58 (S.C.)] • M/s. Moti Talkies v. Commr. of S.T. [2020 (6) TMI 87 - Tri. Del.] • Mormugao Port Trust v. Commr. of Cus. [2016 (11) TMI 520 - Tri. Mum.]
(iv) Despite this settled position, the Ld. adjudicating authority has erroneously determined the value of alleged services on a notional basis using the highest ticket price, even while acknowledging that no consideration was ever received by the Appellant. The Authority has further observed that the alleged "consideration" for issuance of complimentary tickets is the "mutual interest" arising from the agreements.
(v) It is submitted that "mutual interest" does
not fall within the definition of
"consideration" under Section 67.
Consideration must be a quantifiable
monetary or non-monetary benefit flowing Page 8 of 21 Appeal No.: ST/75256/2024-DB from the recipient to the service provider, not a general commercial benefit or contractual right incidental to a larger arrangement. The agreements itself govern ticketing rights, which are part of the contractual framework and cannot be re-characterized as quid pro quo for issuance of complimentary tickets.
(vi) In view of the above, the valuation methodology adopted by the Department under Section 67 read with Rule 3(a) of the Service Tax (Determination of Value) Rules, 2006 is wholly fallacious and legally unsustainable.
C. Without prejudice to the above, the activity of issuance of complimentary match tickets are linked to the stadium usage rights granted by the State Cricket Associations and cannot be treated as a separate taxable service.
(i) Without prejudice to the above, it is submitted that the Ld. Adjudicating Authority has erroneously dissected the terms and conditions of the agreements between the Appellant, BCCI, and the State Cricket Associations to treat the Appellant as a service provider for issuance of complimentary tickets as an independent taxable service.
(ii) Under the agreements, the appellant obtained the right to use the stadiums owned by the State Cricket Associations during the IPL season (as per Clause 2.1), subject to fulfilling certain obligations, including Page 9 of 21 Appeal No.: ST/75256/2024-DB issuance of complimentary tickets to BCCI and the State Associations (as per Clause 4.3). Further, issuance of such tickets to BCCI was in lieu of the franchise rights granted by it to the Appellant, while issuance of tickets to the State Associations was in pursuance of the conditions stipulated for granting stadium usage rights. These complimentary tickets are inseparably linked to the services rendered by the State Cricket Associations and BCCI to the Appellant.
(iii) Therefore, it is submitted that even assuming but not admitting that any service tax were to be levied on such complimentary tickets, it would, if at all, be payable by the State Cricket Associations or BCCI, as the tickets formed part of the contractual consideration flowing to them. The appellant, being the recipient of rights and facilities under these agreements, cannot be treated as a service provider in respect of the same transaction.
(iv) It is a settled principle of law that a contract must be read as a whole and the object with which the parties thereto entered into a contract ought to be ascertained only from the terms and conditions thereof. Reliance in this regard is placed on Super Poly Fabriks Ltd v. CCE [2008 (10) S.T.R. 545 (S.C.)] and CC v. Jaypee Bela Cement [2008 (227) E.L.T. 292 (Tri. - Mumbai)].
(v) In the present case, the obligation to issue complimentary tickets was merely ancillary to the primary contractual purpose of Page 10 of 21 Appeal No.: ST/75256/2024-DB securing the rights and facilities necessary for staging matches and operating the IPL team and formed part of the overall consideration paid for obtaining such rights. Accordingly, it cannot be segregated or treated as an independent activity so as to be taxed separately as a "declared service"
under Section 66E(e).
D. The entire proceedings are barred by limitation in as much as extended period of limitation cannot be invoked when the entire demand has been raised based on the audit observations and records maintained by the Appellant.
(i) The appellant submits that the entire demand has been raised based on the observations of the audit of records of the Appellant initiated by the department on and from 27-12-2017. The facts relating to issuance of complimentary tickets were available on record and within the knowledge of the department during audit proceedings, prior to issuance of the SCN dated 03-07-
2020.
(ii) It is a settled position in law that extended period cannot be invoked alleging suppression when the Department was fully aware of the facts of the case. Reliance in this regard is placed on the following judgments:
• Modipon Fibre Company Vs. Commissioner of C. Ex., Meerut [2007 (218) E.L.T. 8 (S.C.)] Page 11 of 21 Appeal No.: ST/75256/2024-DB • Eveready Industries India Limited v. CCE [2007 (218) E.L.T. 8 (S.C.)] • Development Consultant Pvt Ltd. v.
Commissioner of ST, Kolkata [2024 (5) TMI 807 - CESTAT KOLKATA]
(iii) It is submitted that for the second half-year of the relevant period, the last date for filing of ST-3 returns (i.e., relevant date for Section 73) was 25-04-2017. In terms of Section 73(1) of the Act, the normal period of 30 months has to be reckoned from the relevant date for computation of limitation period. In the instant case, the SCN is dated 03-07-2020 which is beyond the normal period of 30 months and thus the entire proceeding is flawed and unsustainable.
(iv) In any event, it is a settled principle in law that extended period of limitation can be invoked only when the twin conditions of fraud, collusion, wilful misstatement or suppression of facts along with an intent to evade payment of duty must be satisfied.
Further, it is the duty cast upon the department to establish concealment or suppression of facts in order to invoke an extended period of limitation which has not been discharged in the facts of the present case. Mere failure to pay duty/non-payment of duty without any positive act to evade cannot be equated with suppression of facts and hence extended period of limitation cannot be invoked. Reliance in this regard is placed on the following judgements:
Page 12 of 21Appeal No.: ST/75256/2024-DB • Uniworth Textiles Limited Vs Commissioner of Central Excise, Raipur [2013 (288) E.L.T. 161 (S.C.)] • Collector of Central Excise Vs Chemphar Drugs and Liniments [1989 (40) E.L.T. 276 (SC)]
(v) In the present case, the demand arises purely from interpretational disputes regarding the taxability of complimentary tickets, which cannot be equated to wilful suppression. Moreover, when all facts were already known to the department through audit, the extended period is impermissible.
Consequently, the demand beyond the normal limitation period deserves to be set aside.
5.1. In view of the above submissions, the Ld. Counsel for the appellant prayed for setting aside the demands confirmed in the impugned order.
6. The Ld. Authorized Representative of the Revenue strongly opposed the contentions raised by the appellant. It is his submission that as per the said agreement, the appellant were required to supply 15% of the tickets to the State Cricket Association and 5% of the tickets to BCCI. He contends that as the appellant is bearing the cost of these tickets, the appellant is liable to be taxed under the category of 'declared service' within the meaning of Section 66E(e) of the Finance Act, 1994.
Page 13 of 21Appeal No.: ST/75256/2024-DB
7. Heard the parties.
8. The sole issue that appears before us is as to whether the issuance of complimentary match tickets by the appellant to BCCI and State Cricket Associations without any consideration under the tripartite Stadium Agreement could be taxed as a declared service under Section 66E(e) of the Finance Act, 1994, by taking recourse to a notional value, or not.
9. On going through the agreement placed before us, it is observed that Clause 2 of the said agreement is very much relevant. For better appreciation of the facts, the said clause is reproduced hereunder: -
"2 Grant of Rights 2.1 The State Association hereby grants to BCCI (for itself, its agents, and for the benefit of the Franchisee and, whenever appropriate, any Team and each relevant Away Team) the exclusive right and licence to have access to and to use the Stadium during each Contracted Season for the Matches and any practice sessions required by the Franchisee and any other matters connected with the Matches, including press conferences. State Association personnel shall be entitled to have access to the Stadium during each Contracted Season but such access on Match days and days on which practice matches are held in the Stadium shall be limited to accredited State Association personnel and be solely in connection with carrying out its obligations under this Agreement.
2.2 The State Association shall not at any time during the Contracted Season take any action which is inconsistent with the grant of the rights to BCCI under this Agreement including the grant under Clause 2.1 of the exclusive right to use and to licence the use of the Stadium during each Contracted Season. As part of the grant of the rights under this Agreement the State Association agrees that it shall not organise any match, practice or other use of the pitch and training facilities at the Stadium during the Page 14 of 21 Appeal No.: ST/75256/2024-DB Contracted Season nor allow any other third party to do so other than as provided under this Agreement.
2.3 The State Association shall throughout each Contracted Season comply with each of the obligations set out in this Agreement, shall ensure that the facilities set out in Schedule 1 are made available to BCCI and/or the Franchisee (as appropriate), and shall provide all the services stated as being their responsibility as set out in Schedules 2 and 3 herein.
2.4 BCCI will notify the State Association of the scheduled dates of the Matches to be held in the Stadium, it being acknowledged that BCCI reserves the right to change the schedule of the Matches or the number of Matches during the Term at its absolute discretion."
9.1. We have also gone through Clause 4.3 of the agreement, which is extracted below: -
"4.3 The Franchisee shall be responsible for all Ticketing and the access control of areas to the Stadium on Match days. The State Association shall be provided free of charge by Franchisee with 15% of each category of Tickets or otherwise as agreed in writing mutually. The BCCI shall be provided free of charge by Franchisee with 5% of each category of Tickets or otherwise as mutually agreed in writing and as detailed in Schedule 4 in each Season of the Term.
Two VIP boxes each of 24 seats for BCCI use (both boxes to be allocated by BCCI in its sole discretion as a first priority) shall be taken out of the 5% BCCI allocation. The tickets for the IPL central sponsors and other BCCI guests shall also be taken out of the 5% BCCI allocation and be in VIP hospitality locations.
The State Association Tickets shall be marked "free"
or "complimentary" and shall be used for State Association's commitments to members and other organisations. The State Association may elect to receive 10% (and not 15%) of each category of Tickets for use only of its members, in which case any ticket requirements associated with permissions will be managed by the Franchisee.
Page 15 of 21Appeal No.: ST/75256/2024-DB The State Association shall ensure that any third party to which it provides a Ticket complies in full with any terms and conditions of entry set by BCCI including the terms and conditions set out on such Ticket including without limitation the prohibition on selling or using the same for any commercial or promotional purposes. The State Association shall be entitled to give away such Tickets, but not sell them or use them for any commercial or promotional purposes.
Except as noted above, the Franchisee shall retain all ownership and control of, and shall have the right to exploit, all Tickets to the Stadium on Match days, whether for public sale, for Franchisee invited VIP guests and their Licensees or otherwise. The cost of ticket printing and any entertainment tax on the free Tickets to be distributed to the State Association and BCCI will be borne by the Franchisee."
9.2. In terms of the said agreement, the consideration to be paid by the appellant is as under:-
"5.2 In consideration of the State Association making the Stadium available to BCCI and the Franchisee in accordance with the terms of this Agreement and for the proper performance of all its obligations under this Agreement (including without limitation providing the facilities listed in Schedule 1 and the entire services that are listed in Schedules 2 and 3) the Franchisee will pay to the State Association the amount of Rs 30,00,000 (Rupees Thirty Lakh only) (the "Franchisee Fee") and the BCCI will pay to the State Association the amount of Rs 30,00,000 (Rupees Thirty Lakh only) (the "BCCI Fee") in each case plus service tax as applicable in respect of each day on which a Match is staged in whole or in part at the Stadium. The Franchisee Fee and the BCCI Fee shall, together, be the "Fees"."
10. On going through the terms of the aforesaid agreement, we observe that as the consideration for getting the right to use the stadium, the appellant is required to pay Rs.30,00,000/- to the State Cricket Page 16 of 21 Appeal No.: ST/75256/2024-DB Association. Further, as per Clause 4.3 of the above agreement, the appellant was required to provide free-of-charge 15% of each category of tickets to the State Cricket Association and 5% of each category of tickets to the BCCI, apart from the franchisee fees paid to the State Cricket Association.
11. Thus, from the above, it is clear that the appellant is a service recipient in this case and the State Cricket Association, who is receiving all these considerations from the appellant, is the service provider. Admittedly as per Section 66E(e) of the Finance Act, 1994, Service Tax is liable to be paid by the service provider and not the service receiver. As the appellant is the service receiver in this case, in these circumstances, demand of Service Tax against the appellant is not sustainable.
12. We further take note of the fact that the demand has been raised on the basis of notional value of the tickets. The said issue has been examined by this Tribunal in the case of M/s. Hewlett Packard India Sales Private Limited v. Commissioner of Central Excise and Service Tax (LTU), Bangalore [2024 (288) E.L.T. 374 (Tri. - Bang.)] wherein this Tribunal has observed as under: -
"7. The facts are not in dispute. The appellant, post-sale of the computer systems, servers etc., provided free services during warranty period and also paid service tax for the services provided through AMC to customers; and these services have been provided by the appellant through third parties. On AMC service, the appellant had discharged service tax and there is no dispute on the same. It is also an admitted fact that no consideration has been received by the appellant from the customers for providing services during warranty period even though the defective parts had been replaced free of cost. This fact also has been acknowledged by the Commissioner in the finding.Page 17 of 21
Appeal No.: ST/75256/2024-DB
8. The Learned Commissioner however after analysing the provisions of Section 67 of Finance Act, 1994 and Rule 3 of the Service Tax (Determination of Value) Rules, 2006 held that even though no consideration flows from the customers, however, by reading the valuation provisions, the service tax liability on the cost of defective parts replaced during the period can be fastened to the appellant in the absence of value of consideration for the service received. He has recorded his reasoning as follows :-
17.3 From the aforesaid provisions, it becomes clear that as per Rule 3 of the Service Tax (Determination of Value) Rules, 2006, the value determined by the service provider, in the instant case M/s. HP India, for the purpose of payment of service tax should not be less than the cost of provision of such services (emphasis supplied), and where the Central Excise Officer is not satisfied with the value adopted, he can verify the documents and records of the service provider in terms of Rule 4(1) ibid and issue a notice thereafter to the service provider demanding the service tax determined by him, as per law, in terms of Rule 4(2) ibid. Though no consideration was received towards provision of service within the warranty period, I hold that M/s.
HP India are liable to pay service tax on such services rendered by them on the value determined in accordance with the provisions of Section 67 of the Finance Act, 1994 read with Rule 3 of the Service Tax (Determination of Value) Rules, 2006. Since consideration of taxable service provided should not be less than the cost of provisions of such service in terms of Rule 3 ibid, based on the cost of such spares used in providing warranty support services and the credit availed thereon and the value of all services of the third party engaged in providing warranty support services and details of service tax credit availed thereon as furnished by M/s. HP India vide their letter dated 22-7-2013., the service tax liability totally amounting to Rs. 80,36,71,458/- (inclusive of cess) for the period from April, 2008 to March, 2013 at the rates specified under Section 66 of the Finance Act, 1994 and Section 66B of the Page 18 of 21 Appeal No.: ST/75256/2024-DB Finance Act, 2012 (w.e.f. 1-7-2012) as envisaged under Section 68(1) ibid, has been worked out. Accordingly, in view of the aforesaid facts, I hold that M/s. HP India are liable to pay the service tax totally amounting to Rs. 80,36,71,458/- (inclusive of cess) on the warranty support service, classifiable under 'Management Maintenance and Repair Service' rendered by them during the period from April, 2008 to 30-6-2012 and as 'service' under Section 65B(44) for the period from 1- 7-2012 to March, 2013. I also hold that they are liable to pay interest at applicable rates under Section 75 of the Finance Act, 1994, on the amount of Rs. 80,36,71,458/- not paid by them.
9. On careful analysis of the said reasoning, we do not find merit inasmuch as in the absence of consideration for providing any service, the determination of value in terms of Rule 3 holding such value being not ascertainable be determined in the manner provided under clause (a) or clause (b) of the said sub-rule is fallacious and misunderstanding of the very concept of levy of service tax. It is an incorrect approach of the adjudicating authority that the consideration be determined by resorting to valuation when no such consideration is received from the customers for providing services during warranty period. It is not the case of the department that the Appellant though received value of the services but the same could not be quantified or ascertained, hence resort to the method of valuation becomes necessary. It is a case of non-receipt of any consideration for the service rendered. Recently, the Hon'ble Supreme Court in the case of CGST&CE v. Edelweiss Financial Services [2023 (73) G.S.T.L. 4 (S.C.) = (2023) 5 Centax 58 (S.C.)] held as follows :-
5. The Counsel would next advert to Paragraph 3.1.12 of the Commissioner's order where the following was recorded :-
"Further, the consideration can be of two types viz., monetary consideration and non- monetary consideration. In the present case, the Assessee has argued that they have not received any consideration. In such case it's for the department to prove that the Assessee's claim is wrong. It is observed that Page 19 of 21 Appeal No.: ST/75256/2024-DB nowhere in the Show Cause Notice, attempt has been made to prove that the Assessee received either monetary or non-monetary consideration in any form. It is not alleged or proved in the Show Cause Notice as to how the Assessee got any benefit from their subsidiaries in monetary or non-monetary terms for the Corporate Guarantees issued. Missing this vital point, valuation of the consideration using provisions of Section 67(1) of the Finance Act, 1994 become a futile exercise."
6. Mr. Rai Chandani then read paragraphs 8 and 9 of the judgment of the Tribunal, which are extracted below :-
"8. The criticality of 'consideration' for determination of service, as defined in section 65B(44) of Finance Act, 1994, for the disputed period after introduction of 'negative list' regime of taxation has been rightly construed by the adjudicating authority. Any activity must, for the purpose of taxability under Finance Act, 1994, not only, in relation to another, reveal a 'provider', but also the flow of 'consideration' for rendering of the service. In the absence of any of these two elements, taxability under section 66B of Finance Act, 1994 will not arise. It is clear that there is no consideration insofar as 'corporate guarantee' issued by respondent on behalf of their subsidiary companies is concerned.
9. The reliance placed by Learned Authorised Representative on the 'non- monetary benefits' which may, if at all, be of relevance for determination of assessable value under section 67 of Finance Act, 1994 does not extend to ascertainment of 'service' as defined in section 65B(44) of Finance Act, 1994. 'Consideration' is the recompense for the 'contractual' undertaking that authorizes levy while 'assessable value' is a determination for computing the measure of the levy and the latter must follow the former."
7. The above would suggest that this was a case where the assessee had not received any consideration while providing corporate Page 20 of 21 Appeal No.: ST/75256/2024-DB guarantee to its group companies. No effort was made on behalf of the Revenue to assail the above finding or to demonstrate that issuance of corporate guarantee to group companies without consideration would be a taxable service. In these circumstances, in view of such conclusive finding of both forums, we see no reason to admit this case basing upon the pending Civil Appeal No. 428 @ Diary No. 42703/2019, particularly when it has not been demonstrated that the factual matrix of the pending case is identical to the present one.
Since no consideration has been received the service provided by the appellant during the warranty period, hence confirmation of service tax under the taxable service of Management, Maintenance or Repair cannot be sustained."
12.1. Further, in the case of M/s. Moti Talkies v. Commissioner of Service Tax, Delhi-I [2021 (45) G.S.T.L. 168 (Tri. - Del.)], the Tribunal has observed as under: -
"16. It is very difficult to even visualise that the appellant is providing any service to the distributor by renting of immovable property or even any other service in relation to such renting. The agreements that have been executed between the appellant and the distributors confer rights upon the appellant to screen the film for which the appellant is making payment to the distributors. The distributors are not making any payment to the appellant. Thus, no consideration flows from the distributors to the appellant for the alleged service."
12.2. In view of the above, as there is no consideration received by the appellant for providing such complimentary tickets, we hold that their value has to be ascertained as 'zero' and thus, no Service Tax is payable. Accordingly, we hold that the appellant is not liable to pay Service Tax on the complimentary tickets issued to the State Cricket Association and BCCI, without any consideration. In view of this, the impugned demands are set aside.
Page 21 of 21Appeal No.: ST/75256/2024-DB 12.3. Since the impugned demands are not sustainable, no penalty is imposable on the appellant.
13. In view of our above observations, we set aside the impugned order and allow the appeal, with consequential relief, if any.
(Operative part of the order was pronounced in open court) Sd/-
(ASHOK JINDAL) MEMBER (JUDICIAL) Sd/-
(K. ANPAZHAKAN) MEMBER (TECHNICAL) Sdd