What are the penal provisions for various contraventions of the Service Tax Law?

Date: 17-7-2015

The Government has been tightening the penal provisions in service tax in recent times with a view to catch hold of serious offenders.The rationale and philosophy of the government behind introducing these harsh measures are towards encouraging voluntary compliance, reduced penalties in case transactions are captured fully and truthfully in records, and that intentional and unrecorded violations should be dealt with severely with no concession whatsoever. The Penal provisions for various contraventions of the Service Tax Law are as follows:-

Sr. No.	Section	Offence	Details
1	76	Failure to pay service tax	In addition to the service tax and interest, penalty not less than Rs.100/- for every day during which failure continues, or @ 1% of such tax per month, whichever is higher but shall not exceed 50% of service tax due.
2	77	General penalty for contravention of any provisions of chapter V of Finance Act, 1994 or rules made there under for which no penalty is provided	a) Failure to take registration in accordance with Sec.69 or rules made thereunder - Rs. 10000 or Rs. 200 per day during which failure continues, whichever is higher. b) Failure to keep, maintain or retain records- Up to Rs.10000/- c) Failure to furnish information, to produce documents called for by Central Excise Officer or to appear before the Central Excise Officer- Upto Rs.10000/- or Rs. 200 per day during which failure continues. d) Failure to pay tax electronically by the person required to pay tax electronically- upto Rs.10000/- e) Failure to issue correct invoice with complete details and account for the invoice in his books of accounts_Upto Rs.10000/- 2. For contravention of any other provisions of the Act where no separate penalty is provided- upto Rs.10000/-
3	78	Service tax not been levied or paid or been short-levied or short-paid or erroneously refunded by reason of fraud or collusion or willful mis-statement or suppression of facts or contravention of any of the provisions of chapter V of Finance Act, 1994 or of the rules made there under with intent to evade payment of service tax	Shall in addition to the Service Tax and interest thereon, if any payable, be the amount equal to the amount of Service tax not levied or paid or short-levied or short paid or erroneously refunded. But where true accounts are available in specified records, the penalty is reduced to 50%. Where the service tax and interest is paid within 30 days, from the date of communication of the order the penalty is 25%. The reduced penalty is available only if the penalty is paid within 30 days of the date of communication of the order.
4	70(1) & Rule 7C	Late filing of returns	Late fee upto Rs.20000/- a)Delay up to 15 days-Rs.500/- b) Delay beyond 15 days and upto 30 days-Rs.1000/- c) Delay beyond 30 days-Rs.1000/- plus Rs.100 per day of delay beyond 30 days Provided the total amount payable in terms of this rule shall not exceed the amount specified in Sec.70 of the Act.

What are the penal provisions for various contraventions of the Service Tax Law?

Date: 17-7-2015

Sr. No.	Section	Offence	Details
1	76	Failure to pay service tax	In addition to the service tax and interest, penalty not less than Rs.100/- for every day during which failure continues, or @ 1% of such tax per month, whichever is higher but shall not exceed 50% of service tax due.
2	77	General penalty for contravention of any provisions of chapter V of Finance Act, 1994 or rules made there under for which no penalty is provided	a) Failure to take registration in accordance with Sec.69 or rules made thereunder - Rs. 10000 or Rs. 200 per day during which failure continues, whichever is higher. b) Failure to keep, maintain or retain records- Up to Rs.10000/- c) Failure to furnish information, to produce documents called for by Central Excise Officer or to appear before the Central Excise Officer- Upto Rs.10000/- or Rs. 200 per day during which failure continues. d) Failure to pay tax electronically by the person required to pay tax electronically- upto Rs.10000/- e) Failure to issue correct invoice with complete details and account for the invoice in his books of accounts_Upto Rs.10000/- 2. For contravention of any other provisions of the Act where no separate penalty is provided- upto Rs.10000/-
3	78	Service tax not been levied or paid or been short-levied or short-paid or erroneously refunded by reason of fraud or collusion or willful mis-statement or suppression of facts or contravention of any of the provisions of chapter V of Finance Act, 1994 or of the rules made there under with intent to evade payment of service tax	Shall in addition to the Service Tax and interest thereon, if any payable, be the amount equal to the amount of Service tax not levied or paid or short-levied or short paid or erroneously refunded. But where true accounts are available in specified records, the penalty is reduced to 50%. Where the service tax and interest is paid within 30 days, from the date of communication of the order the penalty is 25%. The reduced penalty is available only if the penalty is paid within 30 days of the date of communication of the order.
4	70(1) & Rule 7C	Late filing of returns	Late fee upto Rs.20000/- a)Delay up to 15 days-Rs.500/- b) Delay beyond 15 days and upto 30 days-Rs.1000/- c) Delay beyond 30 days-Rs.1000/- plus Rs.100 per day of delay beyond 30 days Provided the total amount payable in terms of this rule shall not exceed the amount specified in Sec.70 of the Act.