SERVICE TAX PAYMENT WRONG ACCOUNTING CODE SELETE, Service Tax

[Nitin Patel]

DEAR EXPERT

WHEN MAKING OF PAYMENT SERVICE TAX WRONG ACCOUNTING CODE SELECTED , SERVICE TAX PAYMENT ON GOODS TRANSPORT AGENCY INSTEAD OF BUSINESS AUXILIARY , IN SERVICE TAX RETURN WE SHOW PAYMENT IN GOODS TRANSPORT AGENCY , WE ARE LETTER SUBMITTED IN RANGE AND DIVISION OFFICE TO WE MISTAKE WHEN MAKING PAYMENT OF SERVICE TAX ADJUSTED AMOUNT IN GOODS TRANSPORT AGENCY , SO WE REQUIRED TO PAY SERVICE TAX IN GTA ?

Posts / Replies

[KASTURI SETHI]

You are not required to pay Service Tax again under GTA. It is sufficient that you have informed the jurisdictional Range Officer as well as Division Office for rectification.After all, there is no mistake on your part regarding main accounting code i.e. 0044. Amount stands deposited under the Head, "Service Tax". Such like mistakes must not be repeated because penalty can be imposed upon an assessee for procedural lapse. However, I think no will be imposed upon you for such minor mistake. Better to avoid mistakes in future. Repeated procedural lapse will INVITE penalty from the department. We can expect lenient view for the first minor procedural lapse/technical.

[YAGAY AND SUN]

In our view, such matters should be brought to the knowledge of P.A.O in writing on or before filing of service tax returns. Please also find attached herewith relevant judgments and ST Circular in this regard, for your kind information.

Relevant Judgments

In Nahar Spinning Mills vs. CCE (2009) 240 ELT 131 (CESTAT) = 2008 (11) TMI 545 - CESTAT, NEW DELHI, duty was paid under wrong head. It was held that when same department is administering both duties, there should be no bar in adjustment of excess duty from one head to other, unless barred by law relying on South Asian Petrochem v CCE (2007) 219 ELT 991 (CESTAT) = 2007 (4) TMI 245 - CESTAT, KOLKATA [Appeal against order of Tribunal in case of South Asian Petition was dismissed by Calcutta High Court (2009) 233 ELT A 133(Cal.) = 2008 (4) TMI 703 - CALCUTTA HIGH COURT ( Commissioner Versus South Asian Petrochem Ltd.). SLP filed by Department against judgment of High Court has been dismissed by Supreme Court on 14-12-2009 (2010) 252 ELT A 73 (SC)]

Relevant Circular

ST Circular No. 58/7/2003

20th May,2003

F.No.157/2/2003 CX.4

Government of India

Ministry of Finance & Company Affairs

Department of Revenue

Central Board of Excise & Customs

Subject:- Using a wrong accounting Code for payment of Service Tax clarification- Regarding.

 

1. I am directed to say that a representation had been received by the Board raising apprehensions regarding using wrong Accounting Code for payment of Service Tax. Whether, amounts to having paid the Service Tax or not.
2. The Board has examined the issue. In this connection, I am directed to clarify that the assessee need not be asked to pay the service tax again. In such cased the matter should be sorted with the P.A.O. As regards to the cases where the assessee was asked to pay service tax again, the amount thus paid may be refunded by the concerned divisional Asst. Commissioner/Deputy Commissioner.
3. The field formations may suitably be informed.
4. Trade Notice may be issued for the information of the trade.
5. The receipt of this Circular may kindly be acknowledged.
6. Hindi Version will follow.

Manish Mohan

Under Secretary to the Government of India

 

[KASTURI SETHI]

M/s.YAGAY AND SUN,

Thanks a lot for the judgement of Apex Court and Board's Circular. I knew the essence but could not remember the circular and the judgment of the Apex Court. Thus you have cemented the opinion.

K.L.SETHI

[Mahir S]

Sir,

It is clarified that presently there is no system available whereby service tax paid into a wrong service tax code can be transferred to correct service tax code.

Circular no. 58/7/2003 has become redundant and non-functional after introduction of online payment of service tax.

[Mahir S]

Relevant extracts from Trade Notice No. 21/13-14-ST-I, dated 11.03.2014, issued by the Service Tax-I, Mumbai Commissionerate.
.
When service tax is paid wrongly under the service tax code of another assessee or same assessee having different service tax code with same PAN.
.
The following legal remedies are available to the assessee to rectify their mistakes.
.
a) As per Rule 6(4A) of the Service Tax Rules, 1994, service tax amount paid wrongly, can be adjusted against liability for succeeding month/quarter, as the case may be.
.
b) In case, facility (a) cannot be availed, the assessee may file a refund application u/s 11B of the Central Excise Act, 1944, for the amount wrongly paid within the time limit prescribed under law.
.
It is clarified that, in spite of availing the above mentioned remedy, the assessee is also required to make service tax payment under correct service tax code.

Any delay in making service tax payment may attract interest as per provisions of the service tax law.

[YAGAY AND SUN]

2015 (10) TMI 2037 - CESTAT NEW DELHI

M/s. Sahara India TV Network Versus C.C.E. & S.T., Noida

Deposit of service tax with wrong registration number of other unit – Rectification of incorrect registration number mentioned in challan of a different unit – Assessee requested to count the amount of service tax deposited towards the other unit – Held That:- In this case, the Assistant Commissioner, Service Tax in charge of the appellant's Mumbai unit has categorically mentioned that the impugned amount of service tax (Rs.25 lakhs) deposited has not been utilised towards paying service tax by the Bombay unit. - in the case of KK Kedia [2014 (10) TMI 602 - CESTAT NEW DELHI] CESTAT, in effect, has held that such adjustment can be permitted

The CESTAT judgement in the case of Plastichemix Industries [2015 (10) TMI 2036 - CESTAT AHMEDABAD] makes a summary observation that there is no provision under the present service tax law for adjustment of service tax payments from the account of one registered unit to the account of another registered unit. It however does not say that there is any provision in the service tax law which prohibits such adjustment.

Issue is not so much in law but it is just a case of wrong registration number with no malafide intention of the assessee as same was brought to Revenue’s notice by assessee himself – No short or delayed payment on part of assessee – Commissionerate of Cochin issued a Trade Notice No. 3/2014 60 squarely covers the issue - Impugned order is set aside in favour of assessee.

[Mahir S]

The facts of the case of the judgement quoted above are that the assessee had informed the department about payment of duty in wrong account in the year 2009. The following judgement is now passed by the CESTAT, New Delhi in the above said case of M/s. Sahara India TV Network Versus C.C.E. & S.T., Noida = 2015 (10) TMI 2037 - CESTAT NEW DELHI as under:

8. In the light of the foregoing discussion, we set aside the impugned order, allow the appeal and remand the case to the primary adjudicating authority with the direction that the necessary adjustment of the impugned amount of ₹ 25 Lakhs be done in accordance with the procedure prescribed in the Cochin Commissionerate Trade Notice dated 10.07.2014 cited above.

Hence, in the above said case, now the adjudicating authority shall examine the challans and records of 2009, and then finally decide the issue.

Also, CESTAT in the case of Plastichemix Industries Vs. CCE&ST, Vadodara vide Order No.A/11151/2014 dated 27.06.2014 = 2015 (10) TMI 2036 - CESTAT AHMEDABAD had held that there was no provision for such adjustment.

So, Nitin Patel ji, we all have provided our valuable guidance to you, now it is upto you to decide which procedure you want to follow.

Please do keep us informed about your final decision taken in the matter.

[Ganeshan Kalyani]

Hope the query under discussion is resolved. I am curious to know about the outcome.

[Mahir S]

Sir,

I still stand by my views posted on 26.10.2015 and 28.10.2015.