Interst on Supplimantry Invocie under CST

[MITSUI PRIME ADVANCED]

 

Dear Sir,

 

This is to inform u that as per excise law “Because Rule 5 of Central Excise Rules, 2002 is the governing rule and accordingly , duty 12.36% along with interest from the due date till the date of payment.” And such case  is applicable on VAT ,

or Interest applicable on supplementary invoice under CST Act or VAT Act  because Excise and CST or VAT  both are Indirect tax.

 

Regards

 

Arjun Sachdeva

[YAGAY andSUN]

Since the interest is in of statutory nature, hence, liabled to be paid. But there are lots of judgments by the various Hon'ble Tribunal in this regard.

Under C.E. Laws, in a recent judgment, it was held that Interest for raising supplimentory invoice is not warranted when there is north bound price movement on which there is no control of the assesee.

Under CST Act, 1956, read with CST R&T Rules, 1957, you may postponed the payment of interest till the time of assessment conducted by the Department since there is no provision for the same. If the assessing authority raises demand then you should pay it off otherwise not.

AI Summary

Interest on Supplementary Invoices: No Interest Required if Price Increase Beyond Control, Per Rule 5, Central Excise Rules 2002 A query was raised regarding the applicability of interest on supplementary invoices under the Central Sales Tax (CST) Act and VAT, referencing Rule 5 of the Central Excise Rules, 2002, which mandates a 12.36% duty with interest from the due date until payment. The response highlighted that while statutory interest is generally payable, various tribunal judgments have ruled that interest is not required for supplementary invoices if price increases are beyond the assessee's control. Under the CST Act, interest payment can be postponed until assessment by the authorities, and payment is only necessary if demanded by the assessing authority.