What if we have not filed the returns within the prescribed due date?

  

 Amount to be paid for delay in furnishing the prescribed return. — 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 specified in section 70 of the Act:

Provided further that where the assessee has paid the amount as prescribed under this rule for delayed submission of return, the proceedings, if any, in respect of such delayed submission of return shall be deemed to be concluded:

Provided also that where the gross amount of service tax payable is nil, the Central Excise officer may, on being satisfied that there is sufficient reason for not filing the return, reduce or waive the penalty.

Where an assessee is filing the ST-3 return after the due dates that are prescribed,  he makes himself liable for payment of late fees as imposed by Section 70 read with Rule 7C of Service Tax Rules, 1994.

The maximum late fee prescribed by the statute is Rs.20000/- . The mechanism ofcalculation of late fee is as below:

Delay of 1 – 15 days – Late Fee of Rs.500/-

Delay of 15 – 30 days – Late Fee of Rs.1000/-

Delay of 31^st day Onwards – Late Fee of Rs.1000/-  Plus Rs.100/- per day, subject to maximum limit of Rs.20000/-

When an assessee remits this late fee and files the return, for a particular period, then proceedings if any, in respect of such delayed submission of return (alone) shall be deemed to be concluded.

The rule also provides that, in case of a NIL Return, i.e. When the Gross Amount of Service Tax payable is NIL, the departmental officer (Superintendent of Central Excise / Service Tax) may reduce or waive the late fee for delay in filing of returns on providing sufficient cause / reason for non filing of returns in time.

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

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