The Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), on Wednesday, held that the date of presentation of the cheque is the date of payment of service tax. Accordingly, the bench quashed a demand for interest for the delay in payment of service tax.
In present case Assessee wrongly filed ST -3 returns, the amount of abatement was miscalculated. Eventually, a show cause notice was issued to the appellant and the lower authority confirmed the demand. Commissioner (Appeals) dismissed the appeal of Assessee by observing that appellant did not provide any data in support of their claim. Being further aggrieved appellant filed an appeal before CESTAT.
Sandeep Mukherjee chartered Accountant appeared at the behest of appellant submitted that there happened a clerical error while submitting ST -3 return and if the correct data taken into consideration appellant will discharge their service tax liability after availing the abatement.
The counsel also added that there happened a time lag in cheque presented for payment of service tax to get credited in government treasury, till that demand of interest has been confirmed for the period.
The assessee endorsed the decision of Delhi tribunal in the case of Travel Inn India Pvt. Ltd. vs. CST, Delhi where it has been held that date of payment is the date of presentation of the cheque.
Judicial member, Ashok Jindal while disposing of the appeal of Assessee- Company impressed with the contention of Assessee and opinioned that there is the demand of interest for the intervening period from the date of presentation of cheque till its realization. The bench found that as per Rule 6 (2A) of the Service Tax Rules, 1994, the date of presentation of the cheque is the date of payment of Service tax.
Tribunal bench also noticed the decision in Travel Inn India Pvt. Ltd. case and also described the provision in Rule 6 (2A) of the Service Tax Rules and held that date of presentation of the cheque is the date of payment of service tax.