Demand not sustainable when Service Tax is already paid prior to its levy

Last updated: 17 February 2023

Save Share

Quick Summary

The CESTAT in Ahmedabad has ruled that a demand for Service Tax cannot be sustained if the entire tax amount was paid by the assessee before the Revenue Department officially levied it. The tribunal found that the Show Cause Notice was issued after the Service Tax had already been paid, making the demand invalid. This decision offers relief to businesses that proactively settle their tax liabilities.

Court :
CESTAT, Ahmedabad

Brief :
The CESTAT, Ahmedabad in Chiron Behring Vaccines Private Limited v. C.C.E. & S.T.-Surat-ii [Service Tax Appeal No. 403 of 2012 dated February 6, 2023] has set aside the demand order issued for the extended period, on the ground that the assessee had already paid the entire Service Tax prior to its levy by the Revenue Department. Held that, the Show Cause Notice ("SCN") under Section 73(3) of the Central Goods and Services Tax Act, 2017 ("the CGST Act") was issued after the Service Tax amount was paid by the assessee, thus, the demand for the tax is not sustainable.

Citation :
Service Tax Appeal No. 403 of 2012 dated February 6, 2023

Daily Limit Reached