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After careful consideration of the facts on record and the circumstances cited by the appellant, when the assessee paid excess amount of tax to the exchequer, law of the land is very clear under Article 265 of the Constitution of India, which says that “No tax shall be levied or collected except by authority of law.”
If Revenue becomes very rigid on strict compliance of the procedure every time and all the time, there could be situations where such rigidness and strictness on the part of the Revenue could become contrary to the provisions of the Article 265 of the Constitution of India.
Revenue is also in agreement with the fact that there had been excess payment of service tax during the relevant period. The appellant interpreting the above provisions of Service Tax Rules 1994 made the adjustment of this excess payment of service tax during the later period though Revenue pleads that the appellant had only one route of claiming this excess payment of service tax by filing a refund claim as per the provisions of Service Tax Rules. However, considering the overall facts on record and the submissions of both the sides, a liberal interpretation and generous view of these Rules quoted above (Service Tax Rules) needs to be taken.
This adjustment of excess payment of shttps://www.taxtmi.com/acts?id=649 tax, considering the facts on record is admissible to the appellant and more so when we consider the combined effect of the relevant provisions of Service Tax Rules, 1994 quoted above.
Adjustment of excess service tax permitted as alternative to refund under liberal interpretation of procedural rules. A liberal reading of Rule 6(3) of the Service Tax Rules, 1994 permits adjustment of excess service tax paid against future liabilities when facts show an excess payment, rather than restricting the assessee solely to a refund claim, consistent with constitutional limits on taxation and the Revenue's concession of excess payment. of Press 'Enter' after typing page number.
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