INTEREST PAYMENT

[SNEHAL SHAH]

sIR,

Our one unit located at surat and now a days excise audit continue auditore raised point for some cenvate credit wrongly awailed -- Rs.1200000 ( twelves lacds ) before 31-03-2011 and Rs.500000 ( five lacs ) after 31-03-2011 . Please give effect of interst payemtn . Please give interest % how interst payment liable .

Regards,

SACHIN

 

[YAGAY andSUN]

Before budget interest was @ 13%  up-to 31-03-2011 and from 01-04-2011 interest is @ 18%.

[ROHAN THAKKAR]

 

Dear Sir,

It has been clarified vide circular No 942/03/2011-CX dated 14-03-2011 read with the Judgement of Supreme Court in the case of UOI v/s Ind-Swift Laboratories P Ltd  which clarifed that the interest is required to be paid from the date of wrong availment of cenvat credit till the date of actual payment.

The interest is required to be paid at 13% p.a till 31-03-2011 and from 01-04-2011, it is required to be paid at 18%. [Notification No 6/2011-CE(NT)

 

AI Summary

Interest on Wrongly Availed Cenvat Credit Clarified: 13% Before March 31, 2011, 18% After, as per Supreme Court. A query was raised regarding the interest payment on wrongly availed Cenvat credit by a unit in Surat, with amounts of Rs. 1,200,000 before March 31, 2011, and Rs. 500,000 after. The responses clarified that interest rates were 13% per annum up to March 31, 2011, and 18% thereafter. The interest is applicable from the date of wrong credit availment until the actual payment date, as per a Supreme Court judgment and relevant circulars.