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TMI BlogService tax interest rateX X X X Extracts X X X X X X X X Extracts X X X X ..... Interest rate of service tax for wrong availment of cenvat credit has been increased from 13 percent to 18 percent from 01.04.2011. If Service tax credit is taken and utilised wrongly on 01.05.2010 and depositing through e-payment challan today instead of reversing cenvat. What rate of interest is to be adopted. whether Interest is required to paid from 01.05.2010 till the date of payment. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - Reply By Mritunjay Kumar - The Reply = Interest rate has been increased from 13 percent to 18 percent vide Notification No.14/2011 . This Notification shall come into force from 1-4-2011. This means that rate of 18 percent will be applicable from date 1-4-2011 as this notification does not have any retrospective effect. Therefore, the rate applicable for interest upto 31-03-2011 will be rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribed in Notification No.26/2004 i.e. rate of 13 percent and thereafter from 1-4-2011, the applicable rate will be 18 percent for interest payment. As regards the date from which the interest will be charged is concerned, it will be the due date from which the Service tax becomes payable i.e. the due date prescribed under Rule 6 of the Service Tax Rule, 1994 . Above said Rule 6 read ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as: 6. Payment of service tax. - 1 (1) The service tax shall be paid to the credit of the Central Government,- (i) by the 6th day of the month, if the duty is deposited electronically through internet banking; and (ii) by the 5th day of the month, in any other case, immediately following the calendar month in which the 22 [service is deemed to be prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ided as per the rules framed in this regard]: Provided that where the assessee is an individual or proprietary firm or partnership firm, the service tax shall be paid to the credit of the Central Government by the 6th day of the month if the duty is deposited electronically through internet banking, or, in any other case, the 5th day of the month, as the case may be, immediately followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the quarter in which the 23 [service is deemed to be provided as per the rules framed in this regard]: Thus, in case of Company, the interest will be charged from 5th/6th of June,2010. However, in case of other assesse, it will be charged from 5th/6th of July, 2010. - Reply By Ramanujam Varadarajan - The Reply = While the views of Mr Mritunjay Kumar is perfectly correctly, wish to add on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e more point to the query raised. Even if the service tax credit is taken and utilised is rectified instead of deposit by cash, but by reversing credit now, the interest would apply. - Service tax interest rate - Query Started By: - RAJESH NEELAKANTA IYER Dated:- 30-10-2013 Service Tax - Got 2 Replies - Service Tax - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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