Service Tax Act : Section 74, 75, 76, 77

As on 24.10.2013

74. Rectification of mistake. -

(1) With a view to rectifying any mistake apparent from the record, the 4[Central Excise Officer] who passed any order under the provisions of this Chapter may, within two years of the date on which such order was passed, amend the order.

4 Substituted (w.e.f. 13.05.2005) by s. 88 of the Finance Act, 2005 (18 of 2005)

(2) Where any matter has been considered and decided in any proceeding by way of appeal or revision relating to an order referred to in sub-section (1), the 1[Central Excise Officer] passing such order may, notwithstanding anything contained in any law for the time being in force, amend the order under that sub-section in relation to any matter other than the matter which has been so considered and decided.

1 Substituted (w.e.f. 13.05.2005) by s. 88 of the Finance Act, 2005 (18 of 2005)

(3) Subject to the other provisions of this section, the 2[Central Excise Officer] concerned

2 Substituted (w.e.f. 13.05.2005) by s. 88 of the Finance Act, 2005 (18 of 2005)

(a) may make an amendment under sub-section (1) of his own motion; or
(b) shall make such amendment if any mistake is brought to his notice by the assessee or the 3[Commissioner] of Central Excise or the 4[Commissioner] of Central Excise (Appeals).

3 Designation substituted vide s.70 of the Finance Act, 1995 (22 of 1995)
4 Designation substituted vide s.70 of the Finance Act, 1995 (22 of 1995)

(4) An amendment, which has the effect of enhancing 5[the liability of the assessee or reducing a refund ], shall not be made under this section unless the 6[Central Excise Officer] concerned has given notice to the assessee of his intention so to do and has allowed the assessee a reasonable opportunity of being heard.

5 Substituted (w.e.f. 10.09.2004) by s. 90 of the Finance (No. 2) Act, 2004 (23 of 2004).
6 Substituted (w.e.f. 13.05.2005) by s. 88 of the Finance Act, 2005 (18 of 2005)

(5) Where an amendment is made under this section, an order shall be passed in writing by the 7[Central Excise Officer] concerned.

7 Substituted (w.e.f. 13.05.2005) by s. 88 of the Finance Act, 2005 (18 of 2005)

(6) Subject to the other provisions of this Chapter where any such amendment has the effect of reducing 8[the liability of the assessee or increasing the refund], the 9[Central Excise Officer] shall make any refund which may be due to such assessee.

8 Substituted (w.e.f. 10.09.2004) by s. 90 of the Finance (No. 2) Act, 2004 (23 of 2004).
9 Substituted (w.e.f. . 13.05.2005) by s. 88 of the Finance Act, 2005 (18 of 2005)

(7) Where any such amendment has the effect of enhancing the 10[liability of the assessee] or reducing the refund already made, the 11[Central Excise Officer] shall make an order specifying the sum payable by the assessee and the provisions of this Chapter shall apply accordingly.

10 Substituted (w.e.f. 10.09.2004) by s. 90 of the Finance (No. 2) Act, 2004 (23 of 2004).
11 Substituted (w.e.f. 13.05.2005) by s. 88 of the Finance Act, 2005 (18 of 2005)

12[75. Interest on delayed payment of Service Tax -

12 Substituted by s.116 of the Finance (No 2) Act, 1998 (21 of 1998)

Every person, liable to pay the tax in accordance with the provisions of section 68 or rules made there under, who fails to credit the tax or any part thereof to the account of the Central Government within the period prescribed, shall pay simple interest 13[at such rate not below ten per cent and not exceeding thirty-six per cent per annum as is for the time being fixed by the Central Government, by Notification in the Official Gazette] for the period] by which such crediting of the tax or any part thereof is delayed.]

13 Substituted (w.e.f. 10.09.2004) by s. 90 of the Finance (No. 2) Act, 2004 (23 of 2004).

14[Provided that in the case of a service provider, whose value of taxable services provided in a financial year does not exceed sixty lakh rupees during any of the financial years covered by the notice or during the last preceding financial year, as the case may be, such rate of interest, shall be reduced by three per cent. per annum]

14 Inserted (w.e.f. 8.04.2011) by s.74 of the Finance Act, 2011(8 of 2011)

75A. 1[ Omitted ]

1 Omitted (w.e.f. 10.09.2004) by s. 90 of the Finance (No. 2) Act, 2004 (23 of 2004).

2[76. Penalty for failure to pay service tax

2 Substituted (w.e.f. 18.04.2006) by s.68 of the Finance Act, 2006 (21 of 2006).

Any person, liable to pay service tax in accordance with the provisions of section 68 or the rules made under this Chapter, who fails to pay such tax, shall pay, in addition to such tax and the interest on that tax amount in accordance with the provisions of section 75, a penalty which shall not be less than 3[one hundred rupees] for every day during which such failure continues or at the rate of 4[two per cent.] of such tax, per month, whichever is higher, higher, starting with the first day after the due date till the date of actual payment of the outstanding amount of service tax:

Provided that the total amount of the penalty payable in terms of this section shall not exceed the service tax payable in terms of this section shall not exceed 5[fifty per cent of] the service tax payable.

3 Substituted (w.e.f. 8.04.2011) for the words 'two hundred rupees' by s.74 of the Finance Act, 2011(8 of 2011)
4 Substituted (w.e.f. 8.04.2011) for the words 'two per cent' by s.74 of the Finance Act, 2011(8 of 2011)
5 Inserted (w.e.f. 8.04.2011) by s.74 of the Finance Act, 2011(8 of 2011)

6[ Illustration

6 Substituted (w.e.f. 8.04.2011) by s.74 of the Finance Act, 2011(8 of 2011)


X, an assessee, fails to pay service tax of ten lakh rupees payable by 5th March. X pays the amount on 15th March. The default has continued for ten days. The penalty payable by X is computed as follows:-
1% of the amount of default for 10 days =1/100 x 10, 00, 000 x 10/31= Rs. 3,225.80
Penalty calculated @ Rs. 100 per day for 10 days =Rs. 1,000
Penalty liable to be paid is Rs. 3,226.00.]

7[77. Penalty for contravention of rules and provisions of Act for which no penalty is specified elsewhere. -

7 Substituted (w.e.f. 10.05.2008) by s. 90 of the Finance Act, 2008 (18 of 2008)

(1) Any person,-

10(a) who is liable to pay service tax or required to take registration, fails to take registration in accordance with the provisions of section 69 or rules made under this Chapter shall be liable to a penalty which may extend to ten thousand rupees;

10 clause (a) substituted by the Finance Act, 2013 w.e.f. 10-5-2013.


(b) who fails to keep, maintain or retain books of account and other documents as required in accordance with the provisions of this Chapter or the rules made thereunder, shall be liable to a penalty which may extend to 8[ten thousand rupees];

8 Substituted (w.e.f. 8.04.2011) by s.74 of the Finance Act, 2011(8 of 2011)


(c) who fails to-
(i) furnish information called by an officer in accordance with the provisions of this Chapter or rules made thereunder; or
(ii) produce documents called for by a Central Excise Officer in accordance with the provisions of this Chapter or rules made thereunder; or
(iii) appear before the Central Excise Officer, when issued with a summon for appearance to give evidence or to produce a document in an inquiry, shall be liable to a penalty which may extend to 9[ten thousand rupees] or two hundred rupees for every day during which such failure continues, whichever is higher, starting with the first day after the due date, till the date of actual compliance;

9 Substituted (w.e.f. 8.04.2011) by s.74 of the Finance Act, 2011(8 of 2011)

(d) who is required to pay tax electronically, through internet banking, fails to pay the tax electronically, shall be liable to a penalty which may extend to 1[ten thousand rupees];

1 Substituted (w.e.f. 8.04.2011) by s.74 of the Finance Act, 2011(8 of 2011)

(e) who issues invoice in accordance with the provisions of the Act or rules made thereunder, with incorrect or incomplete details or fails to account for an invoice in his books of account, shall be liable to a penalty which may extend to 2[ten thousand rupees].

2 Substituted (w.e.f. 8.04.2011) by s.74 of the Finance Act, 2011(8 of 2011)

2) Any person, who contravenes any of the provisions of this Chapter or any rules made there under for which no penalty is separately provided in this Chapter, shall be liable to a penalty which may extend to 3[ten thousand rupees.]

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