One of my Client had not filed ST3 for the last year and he had not paid the service tax also .now he want to clear all his dues along with Interest and penaltty.Please let me know can he file the service tax return and does he need to pay the penalty of Rs 20000/- for no filing of ST3 instead of Rs 2000 which was there in the earlier days?Please do the needful .regards,Ankit
Yes, first of all he will pay the following liabilities, then he can file the service tax return as per Section 70 of Finance Act, 1994 read with Rule 7 of Service Tax Rules, 1994:-
1. Payment of service tax as per section 68 Finance Act, 1994 read with Rule 6 of Service Tax Rules, 1994.
2. Interest as per section 75 of the Act, ibid as amended by Finance Act 2014.
3. Late fees as section 70 Finance Act, 1994 read with Rule 7(c) of Service Tax Rules, 1994.
Where the return prescribed under rule 7 is furnished after the date prescribed for submission of such return, the person liable to furnish the said return shall pay to the credit of the Central Government, for the period of delay of-
(i) fifteen days from the date prescribed for submission of such return, an amount of five hundred rupees;
(ii) beyond fifteen days but not later than thirty days from the date prescribed for submission of such return, an amount of one thousand rupees; and
(iii) beyond thirty days from the date prescribed for submission of such return an amount of one thousand rupees plus one hundred rupees for every day from the thirty first day till the date of furnishing the said return:
Provided that the total amount payable in terms of this rule, for delayed submission of return, shall not exceed the amount (i.e. Rs.20,000/-**) specified in section 70 of the Act.
**substituted for Rs 2,000/- by Finance Act, 2011 w.e.f. 08-04-2011.
It is concluded that if service tax returns related to the period after 08-04-2011, then the maximum late fee would be 20,000/- instead of 2,000/-.