2001 (8) TMI 3 - AT - Service Tax

Service Tax Excess payment of service tax in one semester can be adjusted in the next semester.

Summary

Issues:
Adjustment of excess service tax paid without following proper procedure.

Summary:
The appeal filed by the Revenue concerns the adjustment of excess service tax paid during a specific period, totaling Rs. 3,10,849. The assessee, without adhering to the correct procedure, claimed credit for this amount while filing returns for a subsequent period. The Commissioner of Central Excise (Appeals) noted the discrepancy but only demanded a short payment of interest, which was duly paid by the assessee. The Commissioner viewed the situation as an obvious mistake and suggested rectification under Section 74 of the relevant Act.

Ms. Ananya Ray, representing the Revenue, argued that the only provisions relevant to the adjustment are outlined in Rule 6(3) of the Service Tax Rules, 1994. She acknowledged that the excess payment was indeed made during the specified period and subsequently adjusted by the assessee, albeit not in accordance with the prescribed procedure.

On the other hand, Shri S.K. Pahwa, the advocate for the assessee, contended that the department had accepted the returns where the adjustment was made, rendering the issuance of a Show Cause Notice and demand for duty unwarranted. He advocated for the regularization of the matter and supported the view of the Commissioner (Appeals).

Upon thorough review of the facts and arguments presented by both sides, it was established that there was no dispute regarding the excess tax payment and its subsequent adjustment by the assessee, albeit without following the correct procedure. In the interest of justice, considering the absence of any factual dispute, the Tribunal upheld the decision of the Commissioner (Appeals) to regularize the situation. Consequently, the appeal filed by the Revenue was deemed meritless and rejected.