Finance Act (Service Tax) 1994

Section 75: - Interest on delayed payment of service tax

Every person, liable to pay the tax in accordance with the provisions of section 68 or rules made thereunder, who fails to credit the tax or any part thereof to the account of the Central Government within the period prescribed, shall pay simple interest at such rate not below ten percent and not exceeding thirty six percent per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette, for the period by which such crediting of the tax or any part thereof is delayed.

²[Provided that in the case of a person who collects any amount as service tax but fails to pay the amount so collected to the credit of the Central Government, on or before the date on which such payment is due, the Central Government may, by notification in the Official Gazette, specify such other rate of interest, as it may deem necessary: Provided further that’’]

^{old [1}[Provided that ] in the case of a service provider, whose value of taxable services provided in a financial year does not exceed sixty lakh rupees during any of the financial years covered by the notice or during the last preceding financial year, as the case may be, such rate of interest, shall 35 be reduced by three per cent. per annum.]

Refer: Notification No. 12/ 2014-Service Tax Dated 11/07/2014

1. Inserted vide Chapter V of Finance Act, 2011-12

2. Substituted  vide Chapter V of Finance Act, 2016-17