Chapter V of Finance Act, 1994

75.  1[Interest on delayed payment of service tax]

Every person, liable to pay the tax in accordance with the provisions of section 68 or rules made thereunder, who fails to credit the tax or any part thereof to the account of the Central Government within the period prescribed, shall pay simple interest 2[ 3[at such rate not below ten percent. and not exceeding thirty-six per cent. per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette] for the period] by which such crediting of the tax or any part thereof is delayed.

4[Provided that in the case of a service provider, whose value of taxable services provided in a financial year does not exceed sixty lakh rupees during any of the financial years covered by the notice or during the last preceding financial year, as the case may be, such rate of interest, shall be reduced by three per cent per annum.]

 

*****************************

Notes :

1. Sections 75 to 77 substituted by the Finance (No. 2) Act, 1998, w.e.f. 16-10-1998. Earlier section 76 was amended by the Finance Act, 1997.

2. Substituted for “at the rate of one and one half per cent for every month or part of the month” by the Finance Act, 2001, w.e.f. 16-7-2001.

3. Substituted for “at the rate of fifteen per cent per annum” by the Finance (No. 2) Act, 2004, w.e.f. 10-9-2004. Earlier, it was amended by the Finance Act, 2002, w.e.f. 16-8-2002.

4. Inserted vide Finance Act, 2011 w.e.f. 8-4-2011