Regarding rule 7c penalty

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CA Tushar Lakhanpal (Querist)
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26 November 2011 Hi all...

A friend of mine started a consultancy firm in dec. last year though he registered for service tax & Charged the same from his clients He neither Paid service tax to govt. nor he filed the return..

the total service tax liab including interest and penalty of 75,76,77,78 comes out to be Rs 15000

The service tax liab from dec. to mar 31st is around rs. 3500 . Is there any way where he can escape the penalty of Rs20000 under RULE 7C...

i also need to know whether he is reqd to pay the penalty of Rule 7C and section 76 along with the service tax liability or should he have to wait for the SCN from AO (as same happens in Direct taxes)

Thanks in advance

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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26 November 2011 Late filing fee,covered under rule 7C, is mandatory if there is tax liability. The same has to be paid before filing the 1/2 yearly return meaning thereby no need to wait for SCN.

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CA Tushar Lakhanpal

CA Tushar Lakhanpal (Querist)
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26 November 2011 Thanks sir..

and what does a NIL Return means??

1. No Service tax

2. Service tax liab - Cenvat Credit = Zero??

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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26 November 2011 Nil return means a return which contains no service tax collection and payment.
The second mentioned return is called 'a no liability' return which is not at par with NIL return.

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