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2019 (2) TMI 1492 - AT - Service TaxInterest on delayed payment - case of appellant is that no demand has been raised in the show cause notice and there cannot be interest demand without any demand raised for the tax amount - Held that:- It is not disputed that the appellant admitted its liability of Service Tax on the amount over and above the MGM and paid the same before the issuance of show cause notice and due to which the show cause notice was issued for demand of interest only and confirmation of demand and Service Tax and appropriation of the amount paid as Service Tax was not warranted. Admittedly, there is delay in payment of Service Tax and once the duty is admitted, interest cannot be detached from the duty liability. The liability to pay interest arises when the assessee is liable to pay duty on the day which is prescribed but failed to pay the same. The liability to pay interest arises from the date, the duty is payable till the date it is paid. By such late payment or delayed payment, the Revenue is deprived of the duty. The said amount would be in possession of the assessee who would have the benefit of the said amount - It is to compensate the loss sustained by the Revenue, the interest is imposed and, therefore, the interest is payable for the period during which the Revenue is deprived of the duty, which it was legitimately entitle to and since the assessee had the benefit of the duty by not paying the duty payable on the due late. It is compensatory in nature and is imposed on the assessee who has withheld payment of any tax as and when it is due and payable. The SCN and the orders of the authorities below invoking the provision of Section 75 ibid for demanding interest is perfectly in order and is within the framework of law - Appeal dismissed.
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