penalty for late pmt of service tax??

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CA Abhishek Singh (Querist)
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14 July 2010 plz. calculate the penalty u/s.76 of fianance act for payment of service tax.

month--service tax collected-- due date
jan09---10000(incl. cess) ---31/03/09
feb09---10000 ---31/03/09
mar09---10000 ---31/03/09

actual date of payment 31/07/2010.

waiting for ur reply urgently.

my id abhipcc@rediffmail.com

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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14 July 2010
Delay in payment of service tax

9.1 Delay in payment of service tax, including a part thereof, attracts simple interest in terms of section 75 of the Act. The rate of interest is as prescribed from time to time, in accordance with this section. At present, the rate of interest is 13% per annum (notification No. 26/2004-ST, dated 10.9.2004). Further, failure to pay service tax also attracts a penalty under Section 76 of the Act, which shall not be less than Rs 200 for every day during which such failure continues or at the rate of 2% of such tax per month, which ever is higher, starting with the first day after the due date till the date of actual payment of the outstanding amount of service tax. However, such penalty would not exceed the service tax payable.

we have to pay interest penalty which is 13 % per annum at simple Interest.So we will calculate interest for days counted from due date on amount payable @13 % per annum.In service tax act/rules there is no provision to charge full month interest for delay in part of month.So interest is chargeable for actual delay period for payment

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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14 July 2010 Penatly will be
No. of day defualt =(30+31+30+31)=122 days
Penatly will be higher of

122 * 200 = 24400
or
30000*2% *4 = 2400
i.e penaty will be Rs.24400/-

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