Provided also that where the gross amount of service tax payable is nil, the Central Excise officer may, on being satisfied that there is sufficient reason for not filing the return, reduce or waive the penalty.
6. ….Persons who are not liable to pay service tax (because of an exemption including turnover based exemption), are not required to file ST-3 return.
Query: Whether a person, who has paid service tax for a particular period but failed to file return, can take the benefit of VCES Scheme so as to avoid payment of penalty for non- filing of return?Clarification: Under VCES a declaration can be made only in respect of “tax dues”. A case where no tax is pending, but return has not been filed, does not come under the ambit of the Scheme. However, Rule 7C of the Service Tax Rules provides for waiver of penalty in deserving cases where return has not been filed and, in such cases, the assessee may seek relief under Rule 7C.
- Persons who are not liable to pay service tax (because of an exemption including turnover based exemption), are not required to file ST-3 return in terms of Circular No.97/8/07-ST dated August 23, 2007 and cited judgement.
- Even if service tax return is filed late/ failed to file return – No Penalty in terms of Rule 7C of the STR.