ST-3 return

[CA AJAY KUMAR AGRAWAL]

I request for your valuable views on a situation. Now lots of assesses get registration under Service Tax (either due to ignorance, due to misguidance of professionals or for other reasons) & their gross receipt is less than ₹ 10 Lacs. As they are registered, they are required to submit ST-3. My question is whether there is any way / provision by which in ST-3 return they can simply mention that they are eligible for exemption vide Not.No 33/2012 & not required to fill up financial details ?

[DR.MARIAPPAN GOVINDARAJAN]

Since registration is obtained a NIL return may be filed.

[YAGAY andSUN]

In addition to reply submitted by Govindrajan Sir, please refer Rule 7 c third provisio in this regard.

Provided also that where the gross amount of service tax payable is nil, the Central Excise officer may, on being satisfied that there is sufficient reason for not filing the return, reduce or waive the penalty.

[Ganeshan Kalyani]

Sir, the provision states that return should be filed. Also there is provision where the authority can reduce or waive penalty for not filing return. But second sentence is after enquire is received asking for reason for non filing of return. Better to file nil return.

[Venkataprasad Pasupuleti]

You can file nil returns now & ask for waiver of late fee quoting Rule 7C of Service tax Rules, 1994 (3rd proviso).

alternatively you can refer CBEC Circular No. 97/8/2007-S.T., dated 23-8-2007 vide Para 6.1 it was clarified that “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”. This is beneficial for running of limitation to raise tax demands, if any.

[Ganeshan Kalyani]

If the assessee is not liable to pay service tax, if his turnover is always lower than the ssi limit, then he must surrender the certificate.

AI Summary

Service tax return obligation: registered taxpayers below the turnover threshold may file nil returns or rely on exemption instead. Registered service-providers with turnover below the turnover-based exemption may either file a nil ST-3 return or rely on the exemption to avoid filing. Administrative guidance permits non-filing by persons not liable to pay service tax due to turnover exemption, while authorities may reduce or waive penalties where tax payable is nil and adequate reasons are presented. Where turnover remains consistently below the small-assessee threshold, surrendering the registration certificate is a contemplated compliance option.