News Update

IGST Refund for July month - Rs 132 Cr sanctioned in 10 days out of Rs 753 Cr, says CBEC ChairpersonGST - Revenue Secretary favours overhauling of rate structureMumbai Customs clears pendency of over 1 lakh claims and disburses drawback payment of Rs 7500 CrorePM inaugurates RO-RO ferry service between Ghogha & Dahej in GujaratWorld Economic Forum says Indian economy is on ascendancySovereign Gold Bond - Issue price to be Rs 2971/- per gram for subscription period Oct 23-25RBI insists on bank accounts being linked to AadhaarNo proposal to change method of calculating ceiling prices of scheduled drugs: GovtGovt clarifies it fixes prices of only about 17% of total drugs being sold in marketSolicitor General Ranjit Kumar puts in his papersFormer President Pranab Mukherjee loses his 86-yr-old brother; to attend last rites at BolpurChidambaram raps EC for not announcing Gujarat election datesST - Errors in CESTAT order - Perplexing that instead of setting out paragraph from apex court order against assessee, Tribunal order in favour of assessee reproduced - non-application of mind: High CourtSuspension of Reverse Charge - Side EffectAnti-dumping duty on Soda Ash imported from China, Pakistan and Iran to continue till decision of Gujarat HC - Rescinding Notification to remain in suspensionImports and Exports to Democratic People’s Republic of Korea - Paragraph 2.17 of the FTP 2015-2020 updated to account for UNSC ResolutionsI-T - Rent received for permitting 'hoarding' inside vacant premises of a housing society, are equally eligible annual letting value, so as to claim Section 24 deduction: ITATST – Entire exercise is revenue neutral since service tax which was payable was available as a CENVAT Credit to the appellant themselves instantly after making the payment of service tax: CESTATCX - Soap noodles was sold by HLL to companies against form 'C' who manufactured branded soap - Rule 8 of CE Valuation Rules, 2000 can be resorted to only when transaction is not of sale: CESTATTaliban-sponsored suicide bombers kill 40 soldiers in Kandhar provinceGSTN makes available offline utility for GSTR-3BGST - 2.5% CGST rate notified for intra-State supply of food preparations in unit containers meant for free-distribution to weaker sections + notifies documents to be produced for deemed exports benefitsWhite House launches Signature Campaign to mobilise support for Trump-led tax reformGST - Is it going to be costly perestroika for BJP?Younger generations to face more inequality in old age than present retirees: OECDPower Exchange - Only 4% of about 3750 MU per day generation being tradedTIOL wishes All Netizens a very Happy DiwaliFrench Parliament passes controversial anti-terror law empowering authorities to shut places of worship and restrict freedom of movementGST - CBEC clarifies on movement of goods within State and from one to another on approval basis + also notifies officers empowered to accept or reject application for GST PractitionerLinking Aadhaar with UAN - EPFO launches service for speedy servicesPM interacts with 380 Directors & Dy Secretaries in Central Govt; advises them to break silos with innovative ways
 
Interest-ing change in interest of assessee

FEBRUARY 29, 2016

By CA Pratik Shah and CMA Khushbu Trivedi

THE Union Budget 2016 introduced several amendments in Service Tax including changes in interest rates.

At present, interest in case of delayed payment by the assesse is payable as under:

 

 

Period

Rate per annum as per period of delay

w.e.f. 1 October 2014

•  Delay upto 6 months- 18% p.a.

•  Delay for more than 6 months and upto one year- 18% p.a. for the first 6 months of delay plus 24% p.a. for delay beyond 6 months

•  Delay for more than a year- 18% p.a. for the first 6 months of delay plus 24% p.a. for delay beyond 6 months upto 1 year plus 30% p.a. for any delay beyond one year

A reduction of 3% is available in aforesaid rates for assesses with less than INR 60 lacs turnover.

Budget 2016 changes

Now, Vide Notification No. 13/2016-ST dated 1 March 2016, it is provided that the generic rate of interest would be 15% p.a. However, in cases where Service Tax is collected but not deposited to the exchequer, the rate of Interest will be 24% p.a.

Further, it is provided that in case of assessees with less than INR 60 lacs turnover (in the preceding year) they will be liable to pay interest @ 12% p.a.

The aforesaid Notification will come into effect on the day the Finance Bill, 2016 receives the assent of the President.

The reduction in Interest rate from almost 30% p.a. to 15% p.a. is certainly a welcome move by the Government. This rationalised interest rates will certainly bring smile on the faces of the genuine assessees plagued by funds shortage.

(DISCLAIMER : The views expressed are strictly of the author and Taxindiaonline.com doesn't necessarily subscribe to the same. Taxindiaonline.com Pvt. Ltd. is not responsible or liable for any loss or damage caused to anyone due to any interpretation, error, omission in the articles being hosted on the sites)

POST YOUR COMMENTS