CHENNAI: The Madras High Court has dismissed a petition filed by music composer Harris Jayaraj challenging the show cause notice issued by the Directorate of GST Intelligence on levying service tax on the remuneration he received for composition of music for films.
A division bench of justices R Suresh Kumar and C Saravanan recently passed the orders dismissing the petition filed by the music composer in 2019 against the show cause notice issued in 2018. Referring to the judgment of the High Court delivered in the case of Principal Commissioner of GST and Central Excise, Chennai Vs. Wunderbar Films Private Limited, dated January 4, 2024, the bench said the points raised by the composer’s counsel were answered in the verdict.
It pointed out that the court, in the judgment, has come to an ultimate conclusion that the show cause notice shall not be challenged and it is for the assessee to approach the adjudicating authority/assessing authority and raise their grounds and objections. “... by respectfully following the same, we are inclined to dismiss this writ petition also on the same terms,” the bench said in the order.
Jayaraj had filed the petition challenging the show cause notice served to him asking why the activities, in terms of various agreements he had entered into, should not be treated as service under section 65B (44) and 65B (51) of the Finance Act, and consequently, why the amount received towards composing fee/royalties should not be treated as payment, and hence as taxable value for charging service tax in terms of section 67 of the Finance Act.
Advocate Raghavan Ramabadran, appearing for the composer, submitted that the service rendered by him is permanent in nature, where the entire rights by way of transfer of goods have already been vested with the producer of the films. Hence, it does not come under the purview of service within the meaning of section 65B (44) of the Finance Act.
