2017 (5) TMI 1572 - AT - Service Tax

Rectification of Mistake - credit was allowed erroneously, which is sought to be rectified - Held that - The order has erroneously allowed the entire credit that was denied by the original authority, the mistake is allowed to be rectified - Application for rectification of mistake allowed.

Summary

Issues: Rectification of mistake in tax credit allowance

Analysis:
The issue in this case revolves around the rectification of a mistake in the allowance of tax credit. The applicant contended that the appeal was allowed based on a previous Tribunal order in their own case, which granted credit for specific services. However, the applicant argued that a portion of the denied credit was related to services excluded as ineligible output service, specifically for 'construction and works contract services.' The applicant sought rectification to adjust the allowed credit amount accordingly.

Upon reviewing the submissions and records, it was noted that the final order erroneously allowed the entire credit that was initially denied by the original authority. The correction was made to paragraph 5 of the order, clarifying that the credit was correctly availed only for services used for providing output service other than 'works contract.' As a result, the appeal was partly allowed, excluding the credit amount used for rendering construction and works contract services.

In conclusion, the application for rectification of mistake was disposed of, with the corrected judgment clarifying the extent to which the credit was allowed. The rectification aimed to ensure that the credit was granted in accordance with the applicable laws and regulations, addressing the specific issue of ineligible output service related to construction and works contract services.