Principal-to-princial basis vs revenue sharing mode

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R K cigiri (Querist)
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24 December 2012 Can anyone pl. clarify what exactly is Principal-to-Principal basis as against Revenue Sharing mode. This is w.r.t CBEC Cir. no. 148-ST, dt. 13.12.2011 reg. applicability of ST on film distb. / exibhitors / theatres. How can the agreement between and distb. and theatre owner be examined when they are sharing the revenue from ticket collections ?. Is theatre liable to pay ST under Business Support Services on their share and whether the distb. is liable to pay under Copyright services (prior to 1.7.2012)on their share ?

Madhukar N Hiregange

Madhukar N Hiregange (Expert)
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25 December 2012 No clear answer possible unless the agreement is examined in detail.
The revenue would content that in a revenue share there is a service provided by on party to the other unless the risk and rewards are shared.
The negative list based taxation assumes that any activity is taxable unless there is an exclusion/ exemption.