26 October 2009
Dear all A Manufacturing Pvt. Ltd company started in June 2008, Company is liable for service tax as service receiver on transportation and fright. The company by mistakenly late registered for Service tax on December, 2008 from the service tax department without any objections. Lack of knowledge company was not paid any service tax and now company paid for all service tax dues along with interest and delayed submission penalty of Rs.2000/- per return from April, 08 to September, 09. At the time of ST-3 returns submission the Service tax department says company liable for Penalty of Rs. 200/- per day due to late registration. As per this condition from June, 08 to December, 08 it will approximately 36000/- (200/- for 180 days). Is it right? we afraid that it is too high in this calculation. It seems more than actual service tax paid on services. please clarify...
26 October 2009
Hi aravind, check the example in the provision. u ll get clarified.
M, an assessee fails to pay service tax of Rs.15 lakhs payable by 5th January. He pays the amount on 16th January. What is the penalty payable by M?
Penalty payable is: (a) 2% of the amount of default per month In this case, delay is of 11 days. Therefore, Amount = 2% of (15,00,000 ×11/31)=Rs10,645 or (b) Penalty @Rs. 200 per day of default = Rs.200 per day × 11= Rs 2,200 whichever is higher Thus, penalty payable is Rs 10,645.
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