INTRODUCTION

Service Tax was first brought into force with effect from 1 July 1994. Service Tax is a form of indirect tax imposed on specified services called "taxable services". . The objective behind levying service tax is to reduce the degree of intensity of taxation on manufacturing and trade without forcing the government to compromise on the revenue needs

 Service tax cannot be levied on any service which is not included in the list of taxable services.

All service providers in India, except those in the state of Jammu and Kashmir, are required to pay a Service Tax in India.

BROADCASTING
Taxable Service means any service provided or to be provided to a client, by a broadcasting agency or organization in relation to broadcasting, in any manner. For the removal of doubts, it was declared that as long as the radio or television programme broadcast is received in India and intended for listening or viewing, as the case may be, by the public, such service shall be taxable service in relation to broadcasting, even if the encryption of the signals or beaming thereof through the satellite might have taken place outside India.

 "Broadcasting" has the meaning assigned to it in clause (c ) of section 2 of the Prasar Bharati (Broadcasting Corporation of India) Act, 1990 (25 of 1990) and also includes programme selection, scheduling or presentation of sound or visual matter on a radio or a television channel that is intended for public listening or viewing, as the case may be. Programme means any audio or visual matter, live or recorded, which is intended to be disseminated by transmission of electro-magnetic waves through space or through cables intended to be received by the general public either directly or indirectly through the medium of relay stations;

EXEMPTIONS
To small scale providers Services to UN Agencies. Export of services Services provided to a developer of an SEZ To value of goods & material sold by service provider To taxable services provided by TBI and STEP

 To taxable services provided by entrepreneurs located within the premises of TBI or STEP To services provided to Foreign Diplomatic Missions or Consular Post in India To services provided for personal use of a family member of Diplomatic Agent or Career Consular Officers posted in Foreign Diplomatic Mission/Consular Post in India

CASE STUDY
ETC NETWORKS LTD. Vs. COMMISSIONER MUMBAII The challenged in the present appeal is to penalty of Rs. 1,49,900 imposed upon the appellant for late payment of service tax and late filing of ST-3 returns. It is seen that the appellants were liable to pay service tax on 'Broadcasting Service' w.e.f. 16-7-2001. They got themselves registered with the department. However, during the period July 2001 to July 2002, the tax was not paid in time and returns were not filed due date. The said tax was however subsequently deposited by them on their own without issuance of show cause notice.

 Notice was subsequently issued for confirmation of interest amount of Rs. 1,48,579/- and for imposition of penalty. It is seen that the interest was also paid by the appellant before the issuance of the show cause notice. The adjudicating authority imposed personal penalty of Rs. 1,49,800/- (Rupees one lakh forty nine thousand eight hundred only), which was upheld by the Commissioner (Appeals). Hence the present appeal.

 The appellant's main contention is that during the relevant period they were suffering huge financial crisis and their being lot of confusion, advertising agencies were not accepting their liability to pay service tax. The matter was resolved subsequently by the Indian Broadcasting Federation. It has been contended that even Doordarshan, owned by the Government had a huge problem in collecting the service tax from their clients. Inasmuch as, the appellant was going through a very lean phase because of the negative cash flow, it was difficult for them even to run the day-to-day business and as such, there was delay in depositing the service tax. In any case the appellant having deposited the tax along with interest, imposition of penalty upon them was not justified. Reference has been made to various decisions of the Tribunal waiving penalty in identical circumstances.

VERDICT
The appellant was aware of its liability to pay service tax. As such, the benefit available under Section 80 of the Finance Act, in respect of reasonable cause, cannot be extended to the appellant. Financial crisis cannot be considered to be a factor constituting "reasonable cause" as envisaged in terms of the said Section 80 of the Act. However, taking into account the over all facts and circumstances including the fact of payment of tax before the issuance of the show cause notice and payment of interest. The personal penalty was reduced to Rs. 25,000/- (Rupees twenty five thousand only) but for the above modification in the quantum of personal penalty. The appeal was otherwise rejected.

ACKNOWLEDGEMENT
I would like to thank priti maam for giving me the opportunity to work on this topic in depth.