TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Appellant's Adjustment of Excess Service Tax Valid; Section 73(1) Invocation Deemed Unsustainable</h1> <h3>M/s. Schwing Stetter (India) Pvt. Ltd. Versus CCE, LTU, Chennai</h3> M/s. Schwing Stetter (India) Pvt. Ltd. Versus CCE, LTU, Chennai - 2016 (45) S.T.R. 101 (Tri. - Chennai), [2016] 94 VST 232 (CESTAT) Issues:1. Whether the appellant short paid service tax by adjusting excess payment made in a subsequent monthRs.Analysis:Issue 1:The appellant, engaged in manufacturing and providing services, received a Show Cause Notice proposing service tax demand, interest, and penalty. The adjudicating authority confirmed the demands and imposed penalty under Section 76 of the Finance Act, 1994. The appellant appealed to the Ld. Commissioner (Appeals), who rejected the appeal, leading to the present appeal before the Tribunal.Issue 1 - Detailed Analysis:The appellant argued that the error in payment was due to being a centrally registered taxpayer, which delayed the detection of excess payment made in May 2011, adjusted against the tax liabilities for July 2011. The appellant relied on Rule 6(4A) of Service Tax Rules, allowing re-credit in the succeeding month. The appellant contended that the short payment in July 2011 was due to the adjustment of excess tax paid in May 2011, asserting it was illusory and not real, thus Section 73(1) could not be invoked. The appellant cited case laws supporting their stance. The appellant emphasized that non-observance of the procedure should not deny adjustment against subsequent tax liabilities.The Revenue argued that the adjustment was not made in the succeeding month, as required by Rule 6(1A) of the Service Tax Rules. The Revenue contended that the adjustment made by the appellant was not in order and could not be considered as payment for July 2011, making the demands sustainable.After hearing both sides, the Tribunal analyzed the issue. It was observed that the adjustment was not in strict compliance with Rule 6(4A) but was made known through the ST3 returns, constituting intimation to the department. The Tribunal noted that the excess payment adjustment in subsequent months was permissible, as per the legal principle of interpreting statutes. The Tribunal referenced Section 13 of the General Clauses Act, 1897, stating that 'month' includes months. The Tribunal found the case laws cited by the appellant applicable, settling the issue in favor of the appellant.In conclusion, the Tribunal held that the excess payment adjustment by the appellant in subsequent months was valid. The invocation of Section 73(1) for a non-existing short payment was deemed unsustainable. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief as per the law.
TaxTMI 