TMI Blog2021 (5) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... tax between August, 2016 and February, 2017, i.e. the time when aforesaid notification was in force i.e. 14.05.2016. The notification fixed the rate of simple interest @ 24% in case where any amount is specifically collected as service tax and still not deposited with the Central Government on or before the date on which such payment became due whereas rate of 15% is fixed for any other situation - In the case in hand, it is the specific stand of petitioner that it did not specifically collect the tax from the service recipients. The respondents have quantified interest 24% per annum on the basis of Notification dated 01.03.2016 presuming that the petitioner has specifically collected some amount as service tax and still not deposited wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tiated an investigation against the petitioner alleging for not disclosing correct value of services rendered by it and collected various documents including balance sheet, Form 26AS and recorded different statements of proprietor of the petitioner-firm. On the basis of comparison of balance sheets for the years 2011-12 to 2014-15, Form 26AS with periodical ST-3 returns, respondents found a shortfall in value declared in ST-3 returns which resulted into short payment of service tax to the tune of ₹ 72,65,808. Accordingly, respondents served upon the petitioner a show cause notice dated 24.10.2016 raising demand of ₹ 72,65,808/- alongwith interest and penalty for the period 2010-11 to 2014-15. On 21.03.2017, the petitioner fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 06.08.2020 (Annexure P-7), respondents settled the service tax liability at ₹ 55,70,843/-, rejecting the contentions of petitioner with regard to rate of interest to be charged. Pursuant to notice of motion, reply dated 12.01.2021 has been filed on behalf of respondent No.2 submitting therein that pursuant to order dated 03.10.2019 passed by this Court, the liability was to be calculated within two months of receipt of order by granting benefit of cum-tax value. The Central Government vide Taxation and Other Laws (Relaxation of Certain Provisions) Act, 2020 (No.38 of 2020) dated 29.09.2020 has extended the time limit upto 31.12.2020. The answering respondent vide letter dated 14.07.2020 informed the petitioner about the calcu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest liability by dividing the total tax liability for a particular financial year equally between four quarters which is not justified and against the provisions of law. The interest should be calculated as per the actual service tax liability for a particular quarter. Per contra, learned counsel for respondent No.2, on the basis of reply, has contended that no fault can be found with impugned order which has been passed in consonance with the settled proposition of law. In the case of a person who collects any amount as service tax but fails to pay the amount so collected to the credit of the central government, on or before the date on which such payment is due, the central government may, by notification in the official gazette, sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny amount as service tax but failing to pay the amount so collected to the credit of the Central Government on or before the date on which such payment becomes due. 24 per cent 2 Other than in situations covered under serial number 1 above. 15 per cent It is clear from the above reproduction that the notification fixed the rate of simple interest @ 24% in case where any amount is specifically collected as service tax and still not deposited with the Central Government on or before the date on which such payment became due whereas rate of 15% is fixed for any other situation. In the case in hand, it is the specific stand of petitioner that it did ..... X X X X Extracts X X X X X X X X Extracts X X X X
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