delay in filing service tax return

[Asked by Guest]

can one carry forward cenvat credit even if he fails to file service tax return in time?

[YAGAY and SUN]

Yes, you can.

[Mahir S]

Yes, but  Penalty may be imposed for late filing of Service Tax Return and such Penalty is required to be paid in cash only and can not be adjusted from the available cenvat credit balance.

[Vijay kumar]

Yes. There is no bar to carry forward the credit balance, even when a return is not filed in time. Such credit can be used for payment of tax also since availment of credit and tax payment are not linked to filing of return. However, delay in filing return attracts late fee in terms of Section 70 of the  Finance Act, 1994 read with Rule 7 of the Service Tax Rules, 1994 which can extend upto Rs.20,000/-. Secondly, Department can issue the notice within one year/five years from the date of filing the return, as the case may be. Regards - Vijay Kumar.

AI Summary

Cenvat credit carry forward permissible despite late filing; penalties and notice consequences may still apply.
There is no bar to carrying forward cenvat credit solely because a service tax return was filed late: availment of credit and tax payment are not conditional on timely filing, and the credit can be used to discharge tax. However, late filing attracts late fees and penalties payable in cash that cannot be adjusted against cenvat, and the department may issue notices within the applicable limitation periods.