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....ayment of interest on<br> Query (Issue) Started By: - sunil mehta Dated:- 5-3-2007 Last Reply Date:- 7-3-2007 Service Tax<br>Got 1 Reply<br>Service Tax<br>I narrate the case matter in brief.The matter is regarding interest payable on late payment of'amount'(difference payable on reversal of cenvat credit). A proprietory SSI firm (weaver )opted for exemption under Notification No. 30/2004 on 8/7/20....
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....04 i.e on budget day.The balance in RG 23A part-II was Rs.1000/The amount of cenvat credit in cl.st.of Yarn & cloth was Rs.20000/-The diff.Rs.19000/-was paid along with int.@ 13% vide TR6 challan on 19/12/04 i.e 5 mths.late.The excise have issued a show cause notice saying that int.@ 2% p.m.or rs.1000/-/day is payable under rule 8(3) of Central Excise Rule, 2002.and also penalty under rule 27. I t....
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....hink rule 8(3){int.@ 2 % p.m. or Rs. 1000/- per day,whichever, is less} was amended w.e.f. 1/4/05 which is not useful in this case.(case is pror to 01/04/05) Pl.clarify on the foll:points: 1)whether in fact interest is payale on "reversal of cenvat credit" on difference in shortfall of PLA AMT. PAID? 2)Whether rule 8(3) applies to above case?(i.e. on reversal of cenvat credit due to assessee follo....
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....wing exemption method) Note: Assessee has paid simple interest @ 13% p.a on late payment of PLA amt. before show cause notice was issued. Pl. give supportive decisions in above case. Reply By Surender Gupta: The Reply: The action of the revenue is wrong. If you have received the SCN you can support your case strongly that rule 8 has been amended with effect from 1-3-2007 only. Before that there ....
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....was no relevant provision in rule 8 for recovery of interest on late payment of amount against reversal of Cenvat Credit.<br> Discussion Forum - Knowledge Sharing ....