Whether assessee is liable to pay collected service tax as per provision of Sec.73A even if his turnover is below the taxable turnover i.e. if assessee is availing small service provider exemption?

Section - 073A - Service Tax Collected from any person to be deposited with Central Government

Yes. In the case of Modern Co-Op. Bank Ltd. [2009 (10) TMI 278 - CESTAT, MUMBAI] , it was held that the appellant has collected the service tax from the customers and considering that the case is covered under the exemption limit, did not deposit the same with the revenue, which is a grave error on the part of the appellant and the same cannot be ignored. 

This Tribunal has also held in the case of Pandurang Travels [2009 (4) TMI 123 - CESTAT, MUMBAI] that although the appellant's turnover is below the taxable limits but in case the appellant has collected the service tax from their customers in that case the appellant has to deposit the same within the prescribed time to the Department and in case of any failure it is to be considered as a grave offence and the appellant was held liable for penal action for equivalent amount of penalty. Following the same, I am of the considered opinion that in this case also the appellant collected the service tax from their customers and failed to deposit the same within the time with the department and also not filed the Service Tax Return which are in contravention of the provisions of the Finance Act. For that the appellant is liable for penal action.

Dated: 3-4-2015