AIM Associates Pvt. Ltd. vs Commissioner of Service Tax

V. Ramasubramanian, J.—The assessee has come up with the above appeal challenging a pre-deposit condition imposed by the CESTAT. Heard Mr. K.S. Natarajan, learned counsel for the appellant. Mr. A.P. Srinivas, learned Senior Panel Counsel takes notice for the first respondent.

The question that arises for consideration in the appeal filed by the appellant before the CESTAT is as to whether the services rendered by them to the Indian Railways, is amenable to service tax or not. If the nature of services rendered by the appellant falls under the category of business support services, no service tax is payable. But if it falls under the category of business auxiliary services, then it is liable for service tax.

According to the appellant, they are facilitating the Indian Railways to procure advertisements for display in the digital boards in railway stations. The case of the appellant is that persons who display their advertisements in the display boards of the railways, pay the charges directly to the railways and the appellant takes a commission. In view of the above said contention, we are of the view that the imposition of a pre-condition deposit of more than 50% of the tax demand is onerous. Therefore, the appeal is allowed, the order of the Tribunal is modified directing the appellant to make the pre-deposit of Rs. 2,00,000/- (Rupees two lakhs only) within a period of four weeks. Upon such deposit, the Tribunal shall number the appeal and dispose it of in accordance with law. Consequently, M.P. No. 1 of 2015 is closed. No costs.