No Service Tax on revenue sharing agreement between exhibitor & distributor for exhibiting film

Last updated: 14 June 2024
Quick Summary
The Supreme Court has ruled that revenue sharing agreements between film exhibitors and distributors for showcasing movies are not subject to service tax. The court upheld previous decisions that such arrangements do not constitute 'Business Support Services' when the parties mutually agree to exhibit films, with copyright retained by the distributor. This decision clarifies that a revenue-sharing model does not automatically imply a service provision.

Court :
Supreme Court of India

Brief :
The Hon'ble Supreme Court in Commissioner of Central Excise and Service Tax Ludhianav. AB Motions Pvt. Ltd. [Civil Appeal Diary No(s). 12044/2020dated May 17, 2024] has disposed the appeal filed by Revenue challenging earlier order passed in favour of the Respondent by the CESTAT, which had set aside the demand for service tax w.r.t revenue sharing agreement between Exhibitor and Distributor pertaining to showcasing of films/ movies.

Citation :
Civil Appeal Diary No(s). 12044/2020dated May 17, 2024

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Bimal Jain
Published in Service Tax
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