Serv tax return

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 November 2013 For a company as a serv provider,in the m of sep13, serv tax bills raised by Co.is :
Amt raised Rs.45000
Add: serv tax 12% Rs. 5400
Add: Ed cess 2% Rs. 108
Add: H Ed cess 1% Rs. 54
-----------------------------------
TOTAL Rs.50562
===================================
Output serv tax above is Rs.5562

For the same period, serv tax bills received by Co.is :
Amt raised Rs.60000
Add: serv tax 12% Rs. 7200
Add: Ed cess 2% Rs. 144
Add: H Ed cess 1% Rs. 72
-----------------------------------
TOTAL Rs.67416 ===================================
Input serv tax above is Rs.7416

Query:
Since input tax credit is more that output tax, I have not made any payment. But how to show it in serv tax return as it is asking for challan sheet to be completed.
Pl guide.

CA.Shubhneet Kaur

CA.Shubhneet Kaur (Expert)
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14 November 2013 PLEASE refer this link : https://www.caclubindia.com/experts/input-service-tax-set-off-against-output-service-tax-881645.asp#.UoSo4HCBkpc

Querist : Anonymous

Querist : Anonymous (Querist)

14 November 2013 Sir,

In my case, input service bill raised by 3rd party to us is of "Advertising services". So, I can get full credit of this. By taking this credit, the balance is excess credit against the bills raised by us. Therefore, we have not made any payment through challan.
My query is that if input credit is more than output credit for a particular month, then how to show it in the serv tax return. Bec it is compulsorily asking for challan sheet to be prepared.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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23 July 2025 You're absolutely right in your understanding of the **input credit being more than output liability**, but here's how to deal with it **in the Service Tax Return (ST-3)**, particularly for **pre-GST era** (as in your case for **September 2013**):

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### ✅ **Scenario Recap:**

* **Output Service Tax Liability (including cess)**: ₹5,562
* **Input Credit (advertising services)**: ₹7,416
* **Net Liability**: NIL (since credit > liability)
* **Excess Credit**: ₹1,854 to be carried forward.

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### 🔍 **ST-3 Return Filing Guidance:**

Even when **no challan** is used for payment (because of sufficient input credit), **you still must fill the Challan section**, but in a specific way.

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### 📝 **How to Fill the Return:**

1. **Part B of ST-3** (Service Tax Payable):

* Enter the **taxable value** and **tax/cess** under relevant categories.
* Mention the **output tax liability** (₹5,562).
* Show **input credit utilized** (₹5,562).

2. **Part C (Service Tax Paid Details)**:

* Under **"Paid by Utilization of CENVAT Credit"**, mention ₹5,562.
* **Leave the "Paid in Cash" field blank or enter ‘0’**.

3. **Part E (CENVAT Credit):**

* Enter **input credit availed**: ₹7,416
* Enter **utilized**: ₹5,562
* **Balance CENVAT**: ₹1,854 (to carry forward)

4. **Challan Details (Part H)**:

* **No entry required** if no payment is made through cash/challan.
* The system might **still ask you to complete Part H** — in that case:

* Add **dummy entry** with amount = **0**, or
* Use "Not Applicable" or remarks like "Paid via CENVAT Credit only"

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### 🛠️ If System Doesn't Accept Blank Challan Sheet:

Some versions of the ACES portal required at least **one row** in challan sheet.

📌 **Workaround:**

* Add a challan row with:

* Challan No: `NA`
* Date: `01/09/2013`
* Amount: `0`
* Bank: `NA`
* Remarks: `Paid via CENVAT Credit only`

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### ✅ Final Submission:

This will allow the ST-3 return to be **submitted successfully** without any actual cash payment — and **carry forward the unused credit** to next period.

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### 🔔 Note:

The link you provided (to CAClubIndia) discusses this exact case and confirms that **no challan is needed if paid via CENVAT**, but **portal constraints may need dummy values** in some cases.

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Let me know if you want help **generating the return in XML format**, or need guidance for **next return period’s input carry-forward.**

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