New Delhi:
After NDTV ran reports on SIS Live - the company that won the CWG broadcast rights contract - was formed in January 2010, four months after bidding for the contract had ended, Doordarshan has issued a rebuttal, which says:
The television channel reports regarding the SIS Live the entity selected for production and coverage are not factually correct. The selection of entity has been after adopting due transparent process and approval of competent authorities.
Another issue raised is regarding the Service Tax. Any work outsourced by Doordarshan has an element of Service Tax included in the contract. A letter issued by the Central Board of Excise and Custom in its Form S.T. - 2 dated 28th September, 2010 and issued by the superintendent of Tax at CGO Complex, Lodhi Road, New Delhi clearly specifies the Service tax bearing registration No. ABRFS4787LSD002.
M/s SIS Live had been granted a permanent Service Tax Registration No. ABRFS4787LSD002 on 28/09/2010. Four invoices have been cleared by Prasar Bharati so far. M/s SIS Live in the first two invoices have mentioned Service Tax Registration 'Number Applied for'. Third invoice mentioned Service Tax Registration No. ABRFS4787LSD001(temporary). However, a Permanent Service Tax Registration Certificate was granted by CBEC to M/s SIS Live on 28/09/2010.
It is incumbent on the contracting Entity, namely, M/s SIS Live to pay the Service Tax directly to the Service Tax Authorities. Once this tax is paid, only then Doordarshan makes the final payment. This is the procedure followed for all contractual formalities. Doordarshan had also conveyed to M/s SIS Live to do the needful with regard to the Service Tax liability.
Member (Finance) as part of his observation had clearly stated "Withhold payment on account of Service Tax". However as entity had started process to pay and had paid around 1.8 crore that it would be fair and proper to withhold the payment from 20 per cent of payment due in October, 2010, if need be as paying Service Tax is not responsibility of Prasar Bharati but that of entity.
Under four invoices cleared so far an amount of Rs 147.6 crore i.e. 60% of Contract value of Rs 246 crore has been paid by PB to M/s SIS Live so far. It is important to mention that still 40 per cent payment is to be made and 10 per cent performance guarantee is also with Prasar Bharati. Thus, 50% of the amount is still with Prasar Bharti.
SIS Live is a partnership formed under English law by SIS and its subsidiary SIS Outside Broadcasts Limited in order to provide outside broadcasting services. The firm was a consortium at the time of bidding and later with proper legal advice they were permitted to become "Partnership Firm" before contract.