Advance service tax payments cannot be demanded again for ST-3 misreporting, though late fee for delayed returns may stand.

Advance receipts on which service tax had already been paid could not again be subjected to demand merely because the amounts were not correctly reflected in the ST-3 returns. Rule 6 of the Service Tax Rules, 1994 allows adjustment of excess or advance tax payment against later liability, and the omission to give timely intimation was treated as a procedural lapse rather than a basis for fresh tax, interest or equal penalty where payment had already been made. A chartered accountant's certificate was accepted as reliable evidence of the accounting error and tax payment position. The late fee for delayed filing of ST-3 returns remained undisturbed.

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Issues: Whether the demand of service tax, interest and equal penalty on the amount received in advance could be sustained when the tax had already been discharged and the amount was not properly reflected in the ST-3 returns, and whether the late fee for delayed filing of returns was liable to be disturbed.

Analysis: The record and the chartered accountant's certificate established that the assessee had received advance amounts and had already paid the service tax thereon, though the corresponding entries were not correctly reflected in the ST-3 returns. Rule 6 of the Service Tax Rules, 1994 permits adjustment of excess or advance tax payment against subsequent liability, and the absence of timely intimation was treated as a procedural lapse rather than a ground to sustain a fresh tax demand where the duty had already been paid. The certificate was accepted as reliable evidence of the accounting mistake and the tax payment position. The levy of late fee for delayed filing of returns was not interfered with.

Conclusion: The demand of service tax, interest and equal penalty was not sustainable and was set aside, while the late fee for delayed filing of ST-3 returns was upheld.

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