Makes Service Tax (Compounding of Offences) Rules, 2012
June, 04th 2012
[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]
Government of India
Ministry of Finance
(Department of Revenue)
New Delhi, the 29thMay, 2012
Notification No. 17/2012 - Service Tax
G.S.R. (E).-In exercise of the powers conferred by clause (i) of sub-section (2) of section 94 of the Finance Act, 1994 (32 of 1994)(hereinafter referred to as the Act) read with sub-section (2) of section 9A of the Central Excise Act, 1944 (1 of 1944), made applicable to service tax vide section 83 ofthe Act, the Central Government hereby makes the following rules, namely :
1. Short title and commencement.-
(1)These rules may be called the Service Tax (Compounding of Offences) Rules, 2012.
(2)They shall come into force on the date of publication in the Official Gazette.
2. Definitions.-In these rules, unless the context otherwise requires,-
(a)Act means Chapter V of the Finance Act, 1994 (32 of 1994);
(b)applicant means anyassesseeor any other person, but shall not include officers of Central Excise appointed for exercising the powers under the Act under rule 3 of the Service Tax Rules, 1994;
(c)compoundingauthority means the Chief Commissioner of Central Excise, having jurisdiction over the place where the offence under the Act, have been or alleged to have been committed;
(d)Excise Act means the Central Excise Act, 1944 (1 of 1944);
(e)form means the form appended to these rules;
(f)reporting authority means, the Commissioner of Central Excise or Commissioner of Service Tax, having jurisdiction over the place where the offences under the Act have been or are alleged to have been committed or any other officer as may beauthorisedin this regard by the Chief Commissioner of Central Excise having jurisdiction over the place where such offences under the Act, have been or are alleged to have been committed;
(g)section means a section of the Act; and
(h)wordsand expressions used in these rules and not defined but defined in the Act or Central Excise Act, 1944 shall have the respective meanings assigned to them in the Act or Central Excise Act, 1944, as the case may be.
3. Form and manner of application.- An applicant may, either before or after the institution of prosecution, make an application under sub-section (2) of section 9A ofExcise Act, made applicable to service tax vide section 83 of the Act, in the form appended to these rules, to the compounding authority to compound the offence.
Explanation.-Where an offence under the Act has been committed at more than one place falling under the jurisdiction of more than one compounding authority, then the Chief Commissioner of Central Excise having jurisdiction over such place where the amount of service tax evaded is more than the others, shall be the competent authority.
4. Procedure on receipt of application under rule 3.-(1) On receipt of an application under rule 3, the compounding authority shall call for a report from the reporting authority with reference to the particulars furnished in the application, or any other information, which may be considered relevant for examination of such application.
(2) Such report shall be furnished by the reporting authority within a period of one month or within such extended period as may be allowed by the compounding authority, from the date of receipt of communication from the compounding authority.
(3) The compounding authority, after taking into account the contents of the said application, may, by order, either allow the application indicating the compounding amount in terms of rule 5 and grant him immunity from prosecution in terms of rule 6 or reject such application:
Providedthat application shall not be rejected unless an opportunity has been given to the applicant of being heard and the grounds of such rejection are mentioned in such order:
Providedfurther that application shall not be allowed unless the service tax, penalty and interest liable to be paid have been paid for the case for which application has been made.
(4) A copy of every order under sub-rule (3) shall be sent to the applicant.
(5) The applicant shall, within a period of thirty days from the date of receipt of order under sub-rule (3) allowing the compounding of offences, pay the compounding amount, as ordered to be paid by the compounding authority and shall furnish the proof of such payment to the compounding authority.
(6) The compounding amount once paid shall not be refunded except in cases where the court rejects grant of immunity from prosecution.
(7) The applicant shall not claim, as of right, that his offence be compounded.
5.Fixation of the compounding amount.- For the purpose of compounding of offences under the provisions of the Act, the compounding amount shall be as provided in the following Table, namely:-
Offence specified under section 89 (1)(a) of the Act
Up to fifty per cent.ofthe amount of service tax evasion, subject to minimum of ten per cent. of amount of tax evaded
Offence specified under section 89 (1)(b) of the Act
Uptofifty per cent.ofthe amount of CENVAT Credit wrongly taken orutilised, subject to minimum of ten per cent.ofsaid amount.
Offence specified under section 89 (1)(c) of the Act
Rupees fifty thousand for the first offence and to be increased by hundred per cent. of this amount for each subsequent offence
Offence specified under section 89 (1)(d) of the Act
Uptotwenty five per cent.ofthe amount of service tax not deposited subject to a minimum of two per cent.foreach month for which the amount has not been so deposited.
Providedthat if a person has committed offences falling under more than one category specified above and where the amount of service tax evasion or amount of CENVAT Credit wrongly taken orutilisedis the same for all such offences, the compounding amount, in such cases, shall be the amount as determined for the offence for which a higher compounding amount has been prescribed.
6.Power of compounding authority to grant immunity from prosecution.- The compounding authority, if he is satisfied that any person who has made the application for compounding of offence under these rules has co-operated in the proceedings before him and has made full and true disclosure of facts relating to the case, grant such person, subject to such conditions as he may think fit to impose, immunity from prosecution for any offence under the Act, with respect to the case covered by the compounding of offence.
7. Withdrawal of immunity from prosecution in certain conditions.- (1) An immunity granted to a person under rule 6 shall stand withdrawn if such person fails to pay any sum specified in the order of compounding passed by the compounding authority, under sub-rule (3) of rule 4 within the time specified in the order or fails to comply with any other condition subject to which the immunity was granted and thereupon the provisions of the Act, shall apply as if no such immunity had been granted.
(2) An immunity granted to a person under sub-rule (1) may, at any time, be withdrawn by the compounding authority, if he is satisfied that such person had, in the course of the compounding proceedings, concealed any material particulars, or had given false evidence, and thereuponthe person may be tried for the offence with respect to which immunity was granted or for any other offence that appears to have been committed by him in connection with the compounding proceedings and, thereupon, the provisions of the Act, shall apply as if no such immunity had been granted.
1. I shall pay the compounding amount, as may be fixed by the compounding authority under sub-rule (3) of rule 4 of the Service Tax (Compounding of Offences) Rules, 2012.
2. I understand that I shall not claim, as of right that the offence committed by me under the Act be compounded.
Name and Signature of the applicant.
I,_______son/daughter/wife of ____________residing at __________do solemnly declare that I am making this application in my capacity as ______ and I am competent to verify it.
That the contents of this application are true to the best of my knowledge and belief and no information relevant to the facts of the case has been suppressed. The documents accompanying the application are true copies of the originals and the tables showing financial transactions are correct and are duly attested by me.
Verified today the _____________ day of (month) __________ (year) at_________.