Recovery of Service Tax

1.  Section 73, 73A to 73D and Section 87 provide for recovery

of service tax under various circumstances. The provisions made under each section are separately discussed below.

2.  Section 73 this section empowers the Central Excise Officer to serve notice to the person, chargeable with service tax, which has been not levied or paid or short-levied or short-paid or erroneously refunded. Time limit for serving a notice under this situation is ‘one year’ from the relevant date.

A.   In cases where service tax has been not levied or paid or short-levied or short-paid or erroneously refunded by the reason of fraud; or collusion; or willful mis-statement; or suppression of facts; or contravention of any of the provisions of this act or rules made there under with an intent to evade payment of service tax, then the time limit for serving the notice is extended up to five years.

     Where the service of notice is stayed by order of court, such stay period shall be excluded

3. Section 73A provides for payment by an assesses of any amount collected in excess of the service tax livable or recovery of any amount as representing service tax that has been collected by a person but not deposited with the Central Government.

4    Section 73B enables the Central Government to collect interest on the amount as determined under sub-section (4) of section 73A at a rate notified by the Central Government( not less than 10% but not exceeding 24% p.a.).

5    Section 73C provides for provisional attachment by Central Excise Officer of any property belonging to a person on whom notice is served under sub-section(1) of section 73 or sub-section (3) of section 73A during the pendency of such proceedings.

6    Section 73D provides for publishing the name of any person and any other particulars relating to any proceedings under the provisions of Chapter V of the Finance Act, 1994, in relation to such person, in public interest, in such manner as may be prescribed.

7.  Section 87 provides for recovery of any amount due to the Central Government by any one of the following modes:

A.   by deducting such amount from any money owed to such person, under the control of any Central Excise Officer or any officer of Customs

B. By recovery from any other person from whom money is due to such defaulting person.

C. by restraining any movable or immovable property belonging to such person and detain the same until the amount payable is paid.

D. by preparing a certificate signed by Central Excise officer specifying the amount due and send it to the Collector of district in which such person owns any property or carries on his business. The said Collector, on receipt of such certificate shall proceed to recover from such person the amount specified there under as if it were an arrear of land revenue

This Article is written by CMA Samir Biswal. He can be reached at cmasamirbiswal@gmail.com

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