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2014 (12) TMI 1003 - AT - Service TaxWaiver of pre deposit - Self adjustment of excess service tax - whether the payment/adjustment of Service Tax for the period 2007-08 from the excess payment of ₹ 13,25,576/- made by the appellant during 2005-06 is permissible or not - Business Auxiliary Service - Held that - Rule 6(4A) of the Service Tax Rules, 1994 contains the provisions allowing an assessee to adjust the excess/short payment of Service Tax suo motu. It does not contain any restriction or time limit for making such adjustments. Secondly, appellant has also relied upon favourable decisions of this Bench on this issue holding that such adjustments can be made by a Service Tax assessee. A prima facie case for complete waiver of the confirmed dues and penalties has thus been made out by the appellant. Accordingly, there will be stay on recoveries of confirmed dues and penalties imposed upon the appellant till the disposal of the appeal. - Stay granted.
Issues: Adjustment of Service Tax payment from excess payment made in a previous period.
Analysis: The appeal and stay application were filed against the order upholding the Assistant Commissioner's decision. The key issue at hand is whether the adjustment of Service Tax for the period 2007-08 from the excess payment made in 2005-06 is permissible. The appellant paid Service Tax on a reverse charge basis for commission paid to a foreign agency under Business Auxiliary Service. The appellant argued that Rule 6(4A) of the Service Tax Rules, 1994 allows for adjusting the excess payment in subsequent periods. The appellant cited relevant case laws to support this argument. The appellant's advocate contended that there is no time limit specified in Rule 6(4A) for making such adjustments. Additionally, previous decisions by the Bench supported the appellant's position on the issue. On the other hand, the Revenue argued against using the excess amount paid in 2005-06 for adjustment in 2007-08. After hearing both sides and examining the case records, it was noted that Rule 6(4A) permits an assessee to adjust excess/short payments of Service Tax without any explicit restrictions on timing. The appellant's reliance on favorable decisions by the Bench further strengthened their case for a waiver of confirmed dues and penalties. Consequently, a stay was granted on the recovery of confirmed dues and penalties until the appeal is resolved.
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