delay in filing ST 3

This query is : Resolved

CA Rupesh Maitri (Querist)
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13 November 2007 hello everybody
where can i get the circular stating that the penalty for delay in filing the half yearly return shall not exceed the amount of service tax paid in the half year.

Ajay Gumbar

Ajay Gumbar (Expert)
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13 November 2007 Hi,

You are mixing two different provisions of different penalties.

Section 70 imposes penalty for non or delayed filing of return. Here the maximum limit is Rs. 2000

Section 76 imposes penalty on failure to pay Service Tax. The penalty is Rs. 200 per day for the period of default or @ 2 percent of tax whichever is higher. In this case maximum limit is amount of service tax PAYABLE (not s.t. PAID)

Regards,

Ajay Gumbar.

KAAPIL

KAAPIL (Expert)
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13 November 2007 Very useful.

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Dayal

Dayal (Expert)
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13 November 2007 Service tax return:
The service tax return is required to be filed under Section 70 of the Act read with rule 7 of the Rules, by 'any person liable to pay the service tax'. This return is required to be filed on a half yearly basis, in Form ST-3. For the periods from April to September and October to March, it must be filed by the 25th October and the 25th April respectively. Further, ‘Input Service Distributor’ is also required to file this return. Persons who are not liable to pay service tax (because of an exemption including turnover based exemption), are not required to file ST-3 return

Refer Master Circular No 97/8/2007 dated 23rd August, 2007

Delay in filing of return:
The return is required to be filed by the stipulated date as mentioned above. Delay in filing of return attracts late fee. The late fee presently prescribed vide rule 7C of the Rules, is (a) Rs 500 for delay upto 15 days; (b) Rs 1000 for delay between 15 days and 30 days; and (c) Rs 1000 plus Rs 100 per day beyond 30 days, till the filing of return, not exceeding Rs 2000/-. To avoid late fee, the taxpayer must ensure timely filing of return. In case of returns filed late, the appropriate late fees should be paid at the time of filing the return, without waiting for any communication or notice from the department. Mere non-submission of evidence of payment of late fee along with the return is, however, not a ground for refusal to allow filing of the return

Delay in payment of service tax:
Delay in payment of service tax, including a part thereof, attracts simple interest in terms of section 75 of the Act. The rate of interest is as prescribed from time to time, in accordance with this section. At present, the rate of interest is 13% per annum (notification No. 26/2004-ST, dated 10.9.2004). Further, failure to pay service tax also attracts a penalty under Section 76 of the Act, which shall not be less than Rs 200 for every day during which such failure continues or at the rate of 2% of such tax per month, which ever is higher, starting with the first day after the due date till the date of actual payment of the outstanding amount of service tax. However, such penalty would not exceed the service tax payable