New ST-3 Returns - Along with existing deficiencies further complications added
WE received a mail from Ankit Somaiya who has been closely following the new ST-3 return format. This is what he has to say -
New ST-3 return format has been introduced for the period July, 2012 onwards, vide notification number 01/2013-Service Tax dated February 22, 2013.
This new format was introduced to incorporate the various details required as per the changed service tax provision w.e.f. July 1, 2012 viz. partial reverse charge, negative list, effects of Place of Provision of Services Rules, 2012, etc.
However, the deficiencies of the old format remain unanswered and in addition few more are added to make return filing an arduous task. Some of them are highlighted below -
A. Existing deficiencies which are still unaddressed in the new format:
1. In the CENVAT section, the table requires mentioning whether the assessee is providing any exempted or non-taxable services. Further to which the assessee is required to answer, as to which option has availed under the Rule 6 of the CENVAT Credit Rules, 2004 to comply with their obligation under the said rule. However, to disclose the option selected, the table only provides the option of “separate books” and the options as specified under “Rule 6 (3)”. The option of Rule 6 (3B) is still not included in the new ST3 format.
2. In the new format, three separate tables are provided to show the details of CENVAT credit availed, reversed and utilised in respect of Service Tax, Education Cess and SHE Cess. However, the space to disclose the reversal or payments under Rule 6 (3) has been provided only in the table of CENVAT of Service Tax and the same has not been provided in the table of Education Cess and Sec. & Higher Education Cess. Thus, the reversal or payments under Rule 6 (3) against the CENVAT credit availed of Education Cess and Sec. & Higher Education Cess can be shown only in the space of 'for any other payments/adjustments/reversals (please specify)'.
3. Also, there is no space in either of the tables relating to CENVAT on Service Tax, Education Cess and Sec. & Higher Education Cess, providing for the disclosure of CENVAT reversed under Rule 6 (3B) of CENVAT Credit Rules, 2004. Thus, in such case the reversal under Rule 6 (3B) may be disclosed in the space of 'for any other payments/adjustments/reversals (please specify)' containing the narration as 'Reversal under Rule 6 (3B) of CENVAT Credit Rules, 2004'.
B. Further complications in the new format and utility checks:
1. The notification specifying the services and their percentage of service tax payable by the service provider and service receiver respectively has been issued under section 68 (2) and not under section 93 of the statutory provisions, thus the same is not an exemption notification. However, the same has been provided under the list of exemption notifications.
2. As discussed earlier that there is no option provided to disclose that the assessee is required to reverse the CENVAT under Rule 6(3B). In such case, the assessee can check ‘YES' only in the option ‘Whether providing any exempted service or non-taxable service' and the rest of the options have to be left indicating as ‘NO' as the assessee is not falling under any of those options. But the checks stipulated in the new utility does not allow validating and submission of the return if any one of the option viz. separate books or the options available Rule 6 (3) is filled ‘NO'. Thus, selecting any of the options in the said table would be a wrong disclosure but the assessee has no option and have to check ‘YES' in any one of the options so as to be able to file the return.
DDT is certain that the ACES Service Desk is reading this and would make amends soon.