P.V. Subba Rao ORDER
Dilip Gupta, J. (President)
1. Service Tax Appeal No. 55438 of 2014 and Service Tax Appeal No. 55439 of 2014 have been filed to assail the order dated 25.07.2014 by which the two show cause notices dated 14.06.2012 and 15.03.2013 have been adjudicated upon and service tax amounting to Rs. 2,02,31,146/- has been confirmed under section 73(1) of the Finance Act, 19941 with interest and penalty.
2. The issue involved in these two appeals relates to taxability of 'convenience fee' charged by PVR Limited2 on its customers for online booking of movie tickets under the category of 'online information and database access retrieval system3' defined under section 65(75) of the Finance Act and taxable under section 65 (105)(zh) of the Finance Act.
3. The appellant is engaged in the business of exhibition of movies through various cinema halls located all over India. The appellant sells tickets for movies from the cinema ticket windows and also through its website www.pvrcinemas.com which is accessible through computer and mobiles phones. The website gives information on movies that are currently being exhibited in its cinemas, upcoming movies, trailers of movies and similar information. According to the appellant, no price is charged for accessing this website and any individual can access this website and gain information on movies that are being exhibited or would be exhibited in PVR cinemas. The customers who book tickets online through the website or through mobile phones electronically are required to pay an amount of INR 5/- to INR 25/- per ticket over and above the value of tickets. When the tickets are booked electronically, the hard copies of the same can either be collected over the counter or be retrieved by way of print out from a machine kept outside the counter of the movie hall.
4. The appellant received a show cause notice dated 14.06.2012 for the period 01.04.2007 to 31.12.2011 alleging that the 'convenience fee' charged by the appellant on its customers for booking the tickets online through the website is exigible to service tax under 'OIDAR' but the appellant did not deposit service tax. The show cause notice also invoked the extended period of limitation and created a demand of Rs. 1,70,93,379/- with penalty and interest.
5. The appellant filed a reply on 13.09.2012 refuting the allegations made in the show cause notice. The appellant submitted that service tax cannot be levied on convenience fee under OIDAR as the information provided on the website is available and freely accessible to all; that nothing is charged from the customers when it comes to giving access to the information; that the information available on the website is also available through newspaper advertisements or pamphlets; that the convenience fees is charged for the convenience provided to the customers for booking the tickets online rather than physically standing in the queue; and that the fees charged is only to recover the cost of infrastructure and bank charges.
6. The appellant also received a second show cause notice dated 15.03.2013 for the subsequent period from 01.01.2012 to 30.06.2012. This show cause notice created a demand of Rs. 31,37,767/- with penalty and interest. A reply dated 18.04.2013 was filed by the appellant to this show cause notice.
7. Both the aforesaid show cause notices were adjudicated upon by a common order dated 25.07.2014. The Commissioner confirmed the demand of service tax on convenience fee under the taxable service of 'OIDAR' primarily on the reasoning that the appellant provided online information to the ticket buyer on payment of monetary consideration called 'convenience fee' and, therefore, the claim made by the appellant that the information was provided free of cost is not true. The Commi........