Service Tax NIL Return

[maheswarishankaran]

Friends, 

One of my friend - a sole proprietor, had registered under service tax 4 years ago, but has not filed any returns till date as he has not done any business. What are the consequences of non-filing of NIL returns? Will there be any penalty? If yes, is there a way to avoid it? If he wants to surrender the registration, will the non-filing be a issue? Please suggest a cost-effective and simple way out. 

Thanks & Regards, 

Maheswari 

[Chippy Pavithran]

Hi Have you done this? Pls help me if you managed this.

[amit soni]

There will be penalty for non filing of return. Check the VAT act. You can't avoid the penalties.

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Thanks & Regards
 
CS Amit Soni
B.Com, LL.B., CS
Mob.- 9098632675

[Ramaswami Mohan]

Amit Kumar Ranjan
Amit Kumar Ranjan
Semi Qualified CA

No Need To File Service Tax Return If There Is No Service Tax Payable
May 29, 2015 • 7 Likes • 2 Comments

The most frequently asked question " Whether is it mandatory to file Nil return of service Tax ??"

Today You will get the answer ... Let know ......

Various Tribunals have held that there cannot be any penalty for non-filing of Nil return.

I am sharing the relevant extract of the CBEC Circular (Circular No. 97/8/2007) and Amrapali Barter Case as under for the ease of your reference:

Firstly read point no. 6 of The Circular

"Persons who are not liable to pay service tax (because of an exemption including turnover based exemption), are not required to file ST-3 return.”

Now know about Amrapali Barter Case

In Amrapali Barter Case, the Service provider is registered with the Service Tax Authorities and has not provided any services during a particular return cycle and was also not liable to pay any service tax during that return cycle.

The Hon’ble Tribunal has held that the service provider is not required to file the Service Tax Return (even nil return) for that period as per the CBEC Circular No 97/8/2007-ST dated August 23, 2007.

Further the Hon’ble Tribunal held that in case the Service Provider files the nil return after considerable delay, then also no penalty under Section 77 of Finance Act or fees under Rule 7C of the Service Tax Rule impose-able on him.

Hence such case is fit for invocation of the proviso to Rule 7C and grant waiver of late filing fees.

Similar decision was held by Hon’ble Kolkata Tribunal in the case of M/s Suchak Marketing Pvt Ltd Vs. Comm. of Service Tax, Kolkata [2013 (6) TMI 641]

Thus we can say Persons who are not liable to pay service tax (because of an exemption including turnover based exemption), are not required to file ST-3 return in terms of Circular No.97/8/07-ST dated August 23, 2007 and cited judgment.

Even if service tax return is filed late/ failed to file return – No Penalty in terms of Rule 7C of the Service Tax Rule.

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Written by

Amit Kumar Ranjan
Amit Kumar Ranjan
Semi Qualified CA
2 comments

Leave your thoughts here...

8mo
Lata Pandey
--
Hello Sir, I have a query regarding the applicability of the above judgement.  What if i am a service provider, providing taxable service but the liability to pay service tax falls upon the service recipient (100% RCM). Whether the above judgements are applicable to me also..??
LikeReply1
8mo
Amit Kumar Ranjan
Semi Qualified CA
If you have charged Service Tax then you have to file service tax return irrespective of the matter who will be liable to deposit the tax amount with the government.   Form your queries it seems you have charged Service Tax So this judgement will not be applicable in your case.   PS… See more
LikeReply
7mo
shiva shankaran
shiva
Sir what if somebody was running a business and remitting ST and filing returns. His ST business is closed. But no nil return is filed for subsequent years. Is there a penalty.
LikeReply
7 Likes2 Comments