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Interest on late payment of st wit subsequent adjustment

SUSHANTA KUMAR MISHRA (SERVICE) (20 Points)

26 October 2014

One company has Short paid service TAX in APRIL 2014 of Rs 10,000.00 and it has excess paid of ST of rs 10500.00 in july .

The question is as follows :

can the interest @ 18% for MAY & June will also be adjusted in July Apart form ST and same can be shown in ST3 return.

Please note when service tax paid , Account code has not been taken for any interest as that time it is not required . can we adjust the interst even if initially only we have chose the service provider account code........ not the interest account code.

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Jaikishan (CA) (168 Points)
Replied 26 October 2014

Assessee may adjust excess amount paid by him against Service tax liability for succeding month/quarter not for previous months.

The service tax shall not be paid in short. If it is paid in short the short amount along with interest should be paid to the credit of the Central Government. In case a service provider pays short payment of service tax in one month and paid excess in another month, there may be a question arised as to whether the short payment of service tax can be adjusted against the excess paid in the next month. There is no specific provision for this in the Act or Rules.