Customs Commission decision on interest payment upheld; petitioner advised to seek rectification if needed.

The High Court upheld the decision of the Customs, Central Excise and Service Tax Settlement Commission, ruling that the interest payment directed by the Commission was justified as the petitioner had underpaid service tax. The Court emphasized that unless there are factual errors, the Commission's order should not be interfered with, and any discrepancies can be rectified by the Commission upon application. The writ petition challenging the Commission's order on interest payment was dismissed without costs, with the petitioner advised to seek rectification from the Commission if necessary.

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Issues:
Challenge to order of Customs, Central Excise and Service Tax Settlement Commission regarding interest payment by petitioner.

Analysis:
The petitioner, holding valid service tax registration, rendered works contract service to a recipient who reimbursed only 50% of the service tax directly to the Government. The petitioner paid the remaining 50% to ensure full tax payment. An application was filed before the Settlement Commission under Section 32E of the Central Excise Act, 1944, requiring full disclosure of duty liability. The Settlement Commission entertained the application and granted immunity from prosecution after adjudication.

The petitioner contended that interest payment directed by the Settlement Commission was erroneous as the full service tax had been paid. The respondent-Department argued that there was a short payment leading to interest charges, which were settled by the Commission. The Commission found that the petitioner had indeed underpaid service tax, attracting interest from the date it became payable, settling the tax and interest liabilities.

The Settlement Commission's decision was based on admitted facts of the case. Any errors in the findings could be rectified by the Commission upon application by the petitioner. The High Court cannot interfere in such matters requiring examination of original records and admission statements. The Court held that the Commission's order need not be interfered with unless there are factual errors, which can be rectified by the Commission upon application.

In conclusion, the writ petition challenging the Settlement Commission's order on interest payment was disposed of without costs. The petitioner was advised to approach the Commission for rectification of any factual errors if needed.

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