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Calculate interest and penalties

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Mayank

Accontant

31 Points Posted on 07 November 2012

Hello to all,

Pls help me to solve the following issue (with support of legal provision),

Mr. X are to be paid service tax for 1st half 2009-10, Rs. 100000. At that time prevailing interest rate was @ 13% and penalties was maximum Rs. 2000. But now applicable interest rate is 15% and penalty maximum 20,000. He paid his dues on 06th nov 2012. what is amount of Interest and Penalties. (My concern, should the interest paid / payable according to old provisions relevant to Year 2009-10 only or should I consider new provisions too. If yes then how.)

Replies (2)

CA CS Jainam Shah

Practicing Chartered Accountant

1601 Points Posted on 07 November 2012

I think on a safer side you have to pay interest and penalties as per the old provision as new provision are very burdensome.

So, as per my opinion you should be pay interest & penalties as per the old provision.

gbalakrishnan

owner

997 Points Posted on 07 November 2012

hi,

why one needs to be very scared of tax authorities! sorry friends. what is the guarantee tax authorities fi8ning is always right? Rax authorities need to follow natural justice principlesplease after all citizens are sovereign in indian democracy and no longer subjects as they were under British.