By TIOL News Service

MUMBAI, JAN 15, 2019: THE appellant had adjusted amounts of Rs.5,67,000/- and Rs.15,00,000/- in the months of December, 2013 and March, 2014. This adjustment was, apparently, on account of excess service tax paid in the months of March and April 2011.

Rule 6(4A) of the STR, 1994 reads -

6(4A)  Notwithstanding anything contained in sub-rule (4), where an assessee has paid to the credit of Central Government any amount in excess of the amount required to be paid towards service tax liability for a month or quarter, as the case may be, the assessee may adjust such excess amount paid by him against his service tax liability for the succeeding month or quarter, as the case may be.

The department acknowledged the excess payment but raised the objection that adjustment was required to be made in the subsequent month, as per Rule 6(4A) of the Service Tax Rules, 1994 and not beyond such period.

Accordingly, SCN was issued and culminated into an adjudication order wherein the disputed amount of Rs. 20,67,000/- along with interest was confirmed and penalties were also imposed on the appellant.

The Commissioner(A) found no infirmity in this order and dismissed the appeal filed.

The appellant is before the CESTAT and submits that according to the General Clauses Act, 1897, singular also means plural and hence "month" should be interpreted as "months". Therefore, the service tax adjustment made in the month December 2014, in respect of excess service tax paid in the months of March and April 2011 is proper and justified. Reliance is placed on the Tribunal decision in Schwing Stetter (India) Pvt. Ltd. -2016-TIOL-1895-CESTAT-MAD where an identical issue has been decided in favour of the assessee.

The Bench observed -

"4. On perusal of the Co-ordinate bench decision relied upon by the appellant, I find that interpreting the provisions of Section 13 of the General Clauses Act, 1897, the Tribunal has held that singular include the word plural and accordingly, month also includes months. Thus, interpreting the provisions of said Act of 1897, it was held by the Tribunal that excess amount paid in the month of May 2011 can be adjusted in the subsequent months tax liability. Since the issue arising out of the present appeal is no more res integra in view of the Co-ordinate Bench of this Tribunal in the case of Schwing Stetter (India) Pvt. Ltd. (supra) , I am of the view that the impugned order passed by the learned Commissioner (Appeals) in upholding the adjudged demand against the appellant cannot be sustained for judicial scrutiny."

Finding no merits in the impugned order, the same was set aside and the appeal was allowed.

(See 2019-TIOL-153-CESTAT-MUM)