Service Tax Not Payable On Revenue Sharing Arrangement Between Exhibitors & Distributors Of Films: CESTAT

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled that revenue-sharing arrangements between film exhibitors and distributors are not subject to service tax. The tribunal clarified that such arrangements are partnerships rather than service provisions, and hence, do not fall under the service tax ambit. This decision provides clarity on the tax treatment of revenue-sharing models in the film industry, affirming that shared revenue from joint ventures should not be taxed as services. The ruling is significant for the film industry, providing a clear distinction between partnership profits and taxable services.