04 - 8 Digit Accounting Codes

In the case of M/s Katrina R Turcotte [2012 (12) TMI 579 - CESTAT Ahmedabad], it was held that service tax liability has been discharged by Matrix on the above said activity cannot be denied merely on the ground that it has paid under Advertisement Agency Service. As M/s Matrix has paid the service tax under the category of Advertisement Agency Service that does not mean that M/s Matrix has not paid service tax on behalf of the appellant. By mere paying the service tax liability under wrong head does not meant that service tax liability has not been discharged.

Service tax payment under wrong head still discharges liability; misclassification does not negate tax payment responsibility. Payment of service tax under an incorrect service classification does not, by itself, prevent the tax liability from being regarded as discharged; the essential consideration is that tax was remitted on behalf of the taxable activity, so recording the remittance under a different accounting head ordinarily cannot be used to deny satisfaction of the service tax demand.