NON SUBMITTED S.T-3 RETURN FROM OCT-07 TO MAR-11

[Guest]

Dear All,

               Please help me as per mention tital. I have submitted ST-3 return for GTA & business auxullary for the f.y-2007-08 in 1st half year returns and then oct-07 to march-11 this period s.t-3 returns of both services not submitted to department & not paid paybale service tax. I want to submitted this period s.t-3 returns & payment of both services. So please tell me how much penalties i will pay to the department & any legal action taken to department on my factory.

 

Thanks & Regards

Yogesh

 

[CA Rachit Agarwal]

As per the relevant years.

1. Delay in filing return of income. Rs. 2000 maximum per return

2. Non payment of service tax, interest @ 13%.

3. Penalty amount equal to 100% of value of tax evaded.

4. If the payment is made before the demand is raised or show cause notice, then penalty amount could be reduced.

[KISHORE SONI]

xyz

[KISHORE SONI]

I am not sure that the penalty for delay in filing returns under Service Tax will remain Rs. 2000 maximum per return in the instant case.

The maximum penalty for delay in filing of returns under section 70 has recently been increased from Rs. 2,000 to Rs. 20,000. However, the existing rate of penalty has been retained under Rule 7C of the Service Tax Rules, 1994.

However, it is unclear that how will the quantum of penalty be calculated for filing a return for the half year ended 30th September 2010, if it is filed say on 30th May 2011, or for the earlier periods.

(A )Whether the Penalty will be calculated based on the earlier provision of maximum of Rs. 2,000 till 30.4.2011 (as the new provision has come into force w.e.f. 1.5.2011) plus Rs. 100 per day for 30 days till 30.5.2011, thus aggregating to Rs. 5,000. OR

(B )Whether the penalty will be calculated for the delay of a total no. of 217 days from the due date, which works out to Rs. 19,700. Accordingly, if the return is filed even after 2.6.2011, the maximum penalty would be restricted to Rs. 20000.

A clarity is yet to emerge.

Any thoughts from the Experts ?

AI Summary

Penalty for delayed service tax returns may include delayed filing fines, interest and penalties equal to tax evaded. Non-submission of ST-3 returns for October 2007-March 2011 exposes the taxpayer to delayed-filing penalties, interest on unpaid service tax and penalties equal to tax evaded; paying tax and interest before a demand or show-cause notice may reduce penalty. A legislative increase in the maximum delayed-filing penalty became effective later, and uncertainty exists on how to compute penalty for returns delayed across the amendment date-whether by applying the earlier cap for the pre-amendment period plus daily additions or by aggregating total delay subject to the new cap.