No Service Tax leviable on Revenue Shared between Exhibitor and Film Distributor: Supreme Court

The Supreme Court ruled that revenue sharing agreements between movie exhibitors and distributors are not subject to Service Tax as "Business Support Services." The case debated whether exhibitors' role in showcasing films constituted a taxable service. \r

The court sided with AB Motions, emphasizing that exhibitors primarily provide physical venues and share financial risks with distributors. This collaborative arrangement, as per the court, does not qualify as a service under tax provisions. \r

The decision, drawing from precedent in Commissioner of Service Tax v. Inox Leisure Ltd., clarifies that revenue sharing alone does not imply taxable service, marking a significant outcome for the film industry in India.