Service Tax adjustment under rule 6(4A) of STR 1994

[Yatin Bhopi]

Dear expert

We recently gone through CERA audit. Now they have submitted their report to our excise jurisdiction and pointed out that in 3 instances reflected in ST-3 return where we have adjusted excess service tax paid beyond the time permitted under Rule 6(4A) of STR 1994 i.e. assessee may adjust such excess amount against his service tax laibility for the succeeding month or quarter, as case may be.

Now we have received letter from department where they have asked us to pay Service tax excess paid in the month of May,14 , June 14 and July 14 and adjusted in Aug 14 and Sep 14 (after Two months). Further They have also asked us to pay interest and Penalty.

Please let me know the factual position of law in this regard. There are various case laws in assesses favor

2016 (6) TMI 239 - CESTAT CHENNAI M/s.SchwingStetter(India) Pvt. Ltd. Versus CCE, LTU, Chennai

Please share your views which will help me to give suitable replay

AI Summary

CERA Audit Finds Excess Service Tax Adjustments; Contest Demand Citing Rule 6(4A) STR 1994 Procedural Lapse Case Law (4A) A participant in a discussion forum raised a query regarding a CERA audit report that identified instances of excess service tax adjustments beyond the permissible time under Rule 6(4A) of STR 1994. The department demanded repayment of excess service tax adjusted in August and September 2014 for payments made in May, June, and July 2014, along with interest and penalties. Respondents advised contesting the demand, citing a case law where such non-adjustment was deemed a procedural lapse rather than a short payment of duty. The cited judgment supports the participant's position.