The ticketing portal enters into agreements with cinema homes for cost of tickets booked via its platform. When tickets are booked through its platform, it receives an quantity in the direction of the ticket value together with a comfort charge and remits the ticket value to the cinema home or occasion holder. It had duly paid service tax on the comfort charge earned by it. CESTAT bench famous that it didn’t retain any quantity that was obtained from card corporations and that was supposed to be paid to cinema homes.
Throughout the interval from monetary 12 months 2010-11 to monetary 12 months 2014-15, it collected round Rs. 52.78 crores from card corporations. The service tax authorities contended that BookMyShow was required to pay a service tax of 6.33 crore and raised a requirement discover. This was contested, by stating that the ticketing portal was contractually obliged to gather the precise value of tickets, and the identical was remitted to cinema homes.
For permitting the cardboard corporations to increase provides of reductions and free tickets, it had additionally entered into agreements with numerous card corporations. When the final word buyer used an eligible financial institution’s bank card for cost or buy of cinema or different present tickets, the distinction between the cost made by the shopper and the cost obtained by cinema homes was borne by the bank card firm and was routed via BookmyShow, for which it issued debit notes to the cardboard corporations.
CESTAT dismissed the income division’s declare that BookMyShow was offering enterprise assist companies to bank card corporations.
TOI has earlier analysed these points within the context of Items and Providers Tax (GST). On this story, Pratik Jain, oblique tax accomplice at Worth Waterhouse had defined, “Nevertheless, if the financial institution/UPI cost gateway merely be part of palms with the vendor/e-portal, each work on an impartial foundation and provide reductions/incentives on their very own account on to the shopper, there could also be no GST implications. It is because, arguably neither of the events derive any profit from the opposite. Clear lower language within the contractual paperwork is a should.”
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