CHENNAI TELEPHONES (BSNL) Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THIS appeal is directed against the Order -in -Appeal No. 9/2002 (M -I), dated 28 -2 -2002 passed by the Commissioner of Central Excise (Appeals), Chennai by which he has upheld the order of the lower adjudicating authority and confirming the interest amount of Rs. 48,25,578/ - M/s. Chennai Telephones under Section 75 of the Finance Act, 1994 for the belated remittance of service tax for some of the months during the period from August, 1994 to September, 1998.

(2.) APPEARING on behalf of the appellants ld. Counsel Shri S. Ignatitus submits that during the relevant period, Chennai Telephones was the Central Government department and was depositing the tax on day to day basis. He submits that no interest can be levied on them during that period. In this connection he relied on the decision rendered by the Tribunal in their own case G.M. Telecom BSNL v. CCE, Chandigarh reported in 2003 (160) E.L.T. 318 (Tribunal) = 2003 (57) RLT 748 (CEGAT -Del.). He further submitted that the Department of Telecom Services (DTS) has been corporatised into Bharath Sanchar Nigam Ltd. (BSNL) with effect from 1 -11 -2000 as could be seen from CBEC Service Tax Circular No. 33 -1 -2001, dated 29 -1 -2001. Since the period pertains to August, 1994 to August, 1998 i.e. to say prior to 1 -11 -2000 and since it was a Central Government department, no interest can be charged from them for the alleged belated payments. He further submits that the impugned order may be set aside.

(3.) IN counter, ld. Counsel submits that the date of issue of journal slip from 5 -10 -94 to 14 -10 -98 when it was Department of Telecommunication under the Ministry of Telecommunication was a Central Government department inasmuch as this department of telecommunication was converted into corporatised Company only with effect from 1 -11 -2000, when the department of telecommunication service was converted into a limited company under the name and style of Bharat Sanchar Nigam Ltd (BSNL). Therefore, no interest can be levied on them for such belated payments.