Mir Irshad Ali
(Partner)
(192 Points)
Replied 21 August 2015
Payment of interest on "delayed" payment of Service Tax is mandatory. It is advisable to pay interest suo-moto.
As regards payment of penalty-
In case not involving suppression- [Sec 76 of Finance Act, 1994]
(i) if S.Tax is paid before notice or within 30 days of notice, no penalty is payable.
(ii) Penalty of 25% of (10%) is payable if S.Tax, Interest & penalty [25% of (10%)] is paid 30 days after notice but within 30 days of recept of Order.
(iii) Beyound that the penalty payable is 10% of S.Tax involved.
In case involving suppression- [Sec 78 of Finance Act, 1994]
(i) If S.Tax, interest & 15% penalty is paid before notice or within 30 days of notice, penalty @ 15% is payable.
(ii) Penalty of 25% of (100%) is payable if S.Tax, interest & 15% penalty is paid 30 days after notice but within 30 days of recept of Order.
(iii) Beyound that the penalty payable is 100% of S.Tax involved.
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