Late payment of Service Tax due to bank strike

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 September 2010 Online Service tax could not be deposited as Banks Online Payment server failed due to Bank strike in 6th & 7Th Aug 2009.

But the above Service Tax was deposited on 8th Aug2009 in the early morning as soon as Bank Server restated.

My Question :
Is Interest applicable for 2 days on the service Tax Amount as this was delayed on account Bank strike not because of the payer?

Shyam Lal Naik

Shyam Lal Naik (Expert)
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12 September 2010 Interest not applicable in this case as per the relevant provisions of General Clauses Act.

Querist : Anonymous

Querist : Anonymous (Querist)

13 September 2010 Mr. Shyam Lal Naik

Thanks for guiding me on the Late deposit of Service Tax on account of Bank Strike. Please provide the specific clause of General Clauses Act in which it is mention that there is no need to deposit the interest on late deposit of Tax on account of Bank Strike.

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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02 August 2024 The specific clause you are referring to is **Section 10 of the General Clauses Act, 1897**. This section provides for the exclusion of the time of a bank strike or similar circumstance when calculating the due dates for tax payments.

### **Section 10 of the General Clauses Act, 1897:**

**"10. Computation of time.**
In any Act or Regulation made after the commencement of this Act, where no provision is made for the computation of time, the time shall be computed as follows, namely:

(1) When any act or proceeding is directed or allowed to be done or taken within a prescribed period, then, if the last day of the period is a holiday or a day on which the office is closed, the act or proceeding shall be considered to have been done or taken in due time if it is done or taken on the next day which is not a holiday or a day on which the office is closed.

(2) In computing the period of limitation prescribed by any Act or Regulation, the period of time during which the person was prevented by sufficient cause from presenting the application or petition shall be excluded."

### **Explanation:**

- **Applicability to Tax Payments**: Section 10 provides that if the last day for the payment of taxes or filing of returns falls on a day when banks are closed due to a strike or any other cause, then the payment or filing can be made on the next working day without any penalty for late payment.

This provision is helpful in situations where administrative or procedural disruptions, such as a bank strike, prevent timely compliance with legal requirements.

### **Relevant Case Law and Circulars:**

In practice, the specific application of Section 10 may also be supported by relevant case law and circulars issued by tax authorities, which acknowledge such exceptions.

Always check the latest guidelines and notifications from the tax department or consult with a tax professional for the most current and applicable rules.