Guidelines for scrutiny of service tax returns

Primarily, service tax department is bifurcated into anti-evasion and audit wings so as to keep an eye on service tax defaulters. In order to additionally curb the small assessees, who usually don’t fall in the ambit of service tax audits, CBEC has issued circular 185/4/2015- ST wherein check-list & revised guidelines for carrying out detailed manual scrutiny of service tax returns have been prescribed. The gist of the same has been produced here under:

1) To be made effective from 1st Aug’15 onwards;

2) Focus on small assessees whose total tax paid(Cash + CENVAT) during FY 14-15 is less than INR 50 Lacs, though on the direction of Chief Commissioner, scrutiny of returns can be made for assessee whose monetary limit exceeds even INR 50 Lacs but in no case such assessee can be subjected to both Audit & manual scrutiny;

3) Preliminary online scrutiny to be done by range officers;

4) Prior intimation of 15 days to be given to assessee in the prescribed format.

5) Reconciliation of ST-3 with ITR returns & form 26AS and Sales Tax returns etc.

6) Scrutiny process of an assessee should be completed within 3 months;

The copy of the said circular can be downloaded  from the link given below

http://www.servicetax.gov.in/circular/st-circular15/st-circ-185-2015.pdf