TaxTMI 
TaxTMI 
2006 (4) TMI 15
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....nder Sections 76 and 77 of the said Act. The appellant did not file reply, nor did it attend for personal hearing. The adjudicating authority, therefore, made an ex-parte order demanding the amount of Rs. 87,720/- as service tax and imposing a penalty of the like amount under Section 76 and a further penalty of Rs. 5,600/- for delay in filing of the returns and also demanding interest of Rs 78,266/- for the service tax paid later than the on due dates for all the months. 3 For the period from October 1999 to March 2000, the appellant had filed service tax return on 8 5 2000 by a delay of 13 days A show cause notice dated 31.7.2000 was, therefore, issued for recovery of short payments of total amount of service tax of Rs. 2,55,929/- and a penalty was proposed under the Act for the defaults. The appellant did not submit any reply nor did it avail opportunity of being heard and the matter was, therefore, adjudicated ex parte by demanding service tax of Rs 2,55,929/- and imposing penalty of Rs.200/- per week from 25.11.1999 under Section 76 and further penalty of Rs.400/- under Section 77 for the delay of 13 days at the rate of Rs. 200/- per week. 4 The Commissioner (Appeals) hel....
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....r maximum penalty as Rs. 13,77,419/- because no penalty in excess of the tax short paid could have been imposed and the tax short paid was admittedly Rs. 2,55,929/- even as per the show cause notice. He, further, contended that as regards the half-yearly assessment period of April 1999 to September 1999, though admittedly there was short payment of Rs.87,720/-, the earlier excess payment of Rs. 2,39,829/- for the period from October 1999 to March 2000 was adjustable in view of the provisions of Rule 6 (3) of the said rules. It was also submitted that the appellant had never received assessment orders though at the relevant time the assessing authority was required to fill up the "Assessment Memorandum" prescribed in the form of Return ST-3. It was submitted that no assessment under Section 71 was done by the assessing authority and at the time when these returns were filed by the appellant, there was no provision of self-assessment. 6. The learned authorized representative for the department supporting the reasoning and findings in the impugned order, argued that no adjustment was permissible in respect of excess payments made in particular months and each month was required to ....
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....re than the service tax determined and paid by the assessee, the assessee shall pay the deficiency, alongwith amount of interest determined thereupon, within ten days of the receipt of the copy of the return from the Central Excise Officer and where such service tax is less, the assessee may apply for refund in accordance with the provisions of Section 11 B of the Central Excise Act, 1944 (1 of 1944)". 7.1 The contention that adjustment of excess payment in any month during the half-yearly period was not required to made was canvassed on behalf of the Revenue on the basis of the provision that, 'the assessee may apply for refund', occurring in the above sub-rule (4). The Commissioner (Appeals) has proceeded on the footing that sub-rule (4) of Rule 7, does not contemplate assessment on half-yearly basis since ST-3 return was required to incorporate information for each calendar month. 7.2 Under Rule 6(1), the service tax on the value of taxable services receive during any calendar month is required to be paid to the credit of Central, Government by the 25th of the month immediately following that calendar month. This would mean that the liability to pay service tax for service....
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....the deficiency or claim the refund, as the case may be. It is, therefore, clear that under Rule 7 (4) read with form ST-3 including the "Assessment Memorandum", that the assessee would be entitled to the adjustment of any excess paid in any month/s during the months covered under the half-yearly return against any short payment in any other month/s covered by that half- yearly return. Such adjustment cannot be made between separate half-yearly returns by carrying forward the excess from the earlier half-yearly return to a subsequent half-yearly return because, the excess found on assessment of the earlier half-yearly return will be subject to the provision of Rule 7 (4) and require a refund application to be made by the assessee. 7.4 It, however, appears in respect of the said half-yearly period of October 1999 to March 2000, in which excess payment of Rs. 2, 64,072/- is said to have been made in December 1999 and January 2000, that the Commissioner (Appeals) did not verify whether "Assessment Memorandum" was filled in by the assessing officer making the assessment at the end of which the question of deficiency/excess could have arisen. It was repeatedly stated on behalf of the ....