Service tax : delayed filing of returns: late fee/penalties?

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

21 October 2011 Dear Experts:

This is regarding a firm, into management consulting, that has commenced 3years ago. This firm has paid up all the required service tax for the years 2008-09; 09-10 and 10-11 financial years so far.

However the firm has not filed the half-yearly ST-3 returns, as they were under the impression that if the total tax is paid in full, half-yearly ST-3 returns are not required.

Now, please clarify on the following aspects:

1. Should the firm need to file the ST-3 for all the three years ie 6 half-yearly returns, electronically, now?

2. If so, what is the applicable late fee and penalty in the above case:
- is this late fee, Rs.20,000 or Rs.2000 per half year basis or Rs.20,000/rs.2000 for one full year basis or a one time payment of Rs.20,000/Rs.2000,for all the 3years for this firm?
- similarly is the applicable penalty, Rs.10,000 or Rs.1000 as the case may be, for half-yearly basis or for one ST registration for each year or for one firm for all the 3years?

*So far there is no communication from the department on the latefee/penalties due to the non-filing of the ST-3*

3. Can the firm request for waiver of both the late fee and penalties that are applicable, as it paid all the service tax in time for all the financial years?

4. What would be the applicable interest in the said case, assuming the electronic filing would be made by 5th November?

5. Firm has also realized that accumulated input ST credit is higher and has overlooked in setting against payable service tax, year on year basis. Can it file an application for the refund of input credit? Whats the process/applicable forms?
( though its possible technically to set against the future half-yearly applicable ST. But firm wishes to take the refund of ST input credit if possible given the low volume of business)

Would appreciate, if you can kindly review the case and provide your expert advise...

Many thanks in advance

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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22 October 2011 1. Yes
2. Rs.20,000/- half yearly except for the 1st half yearly return of FY 20112.
3. No chance for waiver.
4. Since tax is paid in time,question of interest does not arise.
5. Not possible.

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