Adjustment of R & D Cess

[Pawan Kumar]

Sir,

I have imported tech. from aboard for ₹ 2.5 Cr, on which i have deposited RandD cess @ 5% i.e. ₹ 12,50000/-, Now i have to pay balance service tax amt ₹ 18,40,000/- ie.(12.36% -5%) as part of Service tax. But problem is that, when i filling ST return, details as under,

Gross Amt : 2,50,00,000

ST Amt @ 12% : 30,00,000

Less RandD Cess paid : 12,50,000

Net Service Tax payable : 17,50,000

Educ. Cess 2% : 35,000/-(auto calculated)

SHE Cess 1% : 17,500/-(auto calculated)

My queries, shall I pay ₹ 18,02,500/-(Rs 17,50,000 + 35000+17500) or ₹ 18,40,000/-

If I pay ₹ 18,40,000/- then how can I adjust the amount in ST-3 Return.

Please advice me.

[YAGAY and SUN]

Dear Pawan,

You may show it excess paid or advance paid and in the subsequent period you may adjust it.

Regards,

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

AI Summary

R&D cess adjustment: excess cess may be shown as advance and adjusted in subsequent service tax return.
Taxpayer paid 5% R&D cess on imported technology and faces a remaining service tax plus education and SHE cesses; adviser recommends treating any excess payment as an advance/excess paid in the ST-3 return and adjusting it against liabilities in a subsequent return period.