We hired an advertisement agency for TV Ads. The agency issued us a bill mentioning separately charges paid by it to TV Channels + service tax charged by them + Agency Commission + Service Tax on commission.
My query is can we take cenvat credit of service tax charged by tv channels to agency.
20 June 2013
1)It is input service and it is in inclusive part of definition of input service.
2)The services of advertisement, sales promotion and market research were specifically mentioned in the definition as eligible input services.
3)‘Sales promotion’ should also cover selling agent’s commission, C&F Agent’s services etc.
4)Even if it is held that the selling agent’s commission or C&F Agents services are not ‘sales promotion’, they would certainly get covered under ‘activities relating to business’.
In Coca Cola India v. CCE (2009) 22 STT 130 = 25 VST 473 = 242 ELT 168 (Bom HC DB),
assessee was manufacturing concentrates of beverages.
5)It was incurring expenditure on marketing and advertising. Its cost was included in price of concentrate sold by assessee (to bottlers who were bottling and selling the beverages).
6)It was held that marketing and advertising services are input services and are eligible for Cenvat credit.
CAclubindia
