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TMI Blog2012 (4) TMI 197X X X X Extracts X X X X X X X X Extracts X X X X ..... rcised uniformly in respect of all the contracts executed by the assessee. It is for the assessee to choose which formulation he wants to follow in a given contract. Whether for the purpose of discharge of service tax liability, accumulated CENVAT credit arising from some other case/contract can be utilized or not. - held that:- there is no such bar or restriction/prescribed in the notification. The notification only stipulates that in respect of a case/contract, where abatement is availed, no CENVAT credit on inputs, capital goods or input services shall be taken. So long as this condition is satisfied, abatement is permissible. - ST/65/2009, ST/171/2010 & ST/40/2011 - A/89 TO 91/2012/CSTB/C-I - Dated:- 20-1-2012 - Ashok Jindal, P R Chandrasekharan, JJ. For Appellant: Shri Z U Alvi, Consultant For Respondent: Shri V K Singh, Additional Commissioner (AR) Per: P R Chandrasekharan: There are three appeals directed against Orders-in-original no. 22/2008/C/ST/2008 dated 30.12.2008; 08/2009/ST/C dated 29.12.2009 and 12/ST/2010/C dated 29.10.2010 passed by the Commissioner of Customs Central Excise, Nagpur. Since all these orders pertain to a common issue, they ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or in notification no. 15/2004. In respect of certain other contracts, they had availed CENVAT credit on inputs/input service and in respect of such contracts they have been discharging service tax liability on 100% of the value of the contract, and, therefore, the demand is not sustainable. 2.1.3. The show cause notice was adjudicated by the Commissioner of Central Excise, Nagpur who vide the order dated 30.12.2008 confirmed the service tax demand of Rs.26,80,18,955/- under section 73 of the Finance Act, 1994 and also ordered recovery of interest on the said amount under section 75 ibid. He imposed equivalent amount of penalty under section 78 of the Finance Act, 1994 and also imposed penalties under sections 76 and 77 of the Finance Act, 1994. 2.2 Appeal no. ST/171/2010: The demand in this case pertains to April 2008 to September 2008. Scrutiny of the records revealed that the appellant had availed abatement of 67% under notification no. 15/2004-ST as amended by notification no. 1/2006-ST dated 01.03.2006 while simultaneously availing CENVAT credit on the inputs/input services during the aforesaid period and hence the appellant was not eligible for abatement and were required ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roject, Gujarat Bhilai Steel plant (BSP) 15, Chhatisgarh NTPC BST V, Chattisgarh NSPCL Bhilai 2 x 250 MW, Chhatisgarh Hindustan Zinc Ltd. (HZL), Rajasthan MPSEB, Birsinghpur 3.2 In respect of these contracts they had availed abatement of 67% as provided for in Notification no. 15/2004. However, in respect of these contracts, they had not availed CENVAT credit on "inputs" used in the rendering of the services. However, they have availed CENVAT credit on input services inasmuch as there was no bar in availing CENVAT credit on input services prior to 01.03.2006. Only on 01.03.2006 notification no. 1/2006-ST dated 01.03.2006 came into force and the said notification prescribed a condition that CENVAT credit should not be availed in respect of service tax paid on input services also. Prior to 01.03.2006 the said restriction did not apply. Therefore, availment of abatement in respect of the above contracts for the period prior to 01.03.2006 is in accordance with law existing at that time and in respect of the above contracts, w.e.f 01.03.2006, they stopped taking credit even on input services rendered and, therefore, availment of abatement of 67% was in acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edit lying in their books of account. These credits arose in respect of some other contracts which was executed earlier. Utilisation of accumulated credit for discharge of service tax liability would not disentitle them from availing abatement. 3.4 The learned consultant also submits that merely because they have a centralized registration for filing of returns and payment of service tax, they should not be denied the benefit of notification no. 15/2004-ST or 1/2006-ST as centralized registration is only a facility given to the assessee and the same does not affect their entitlement to abatement so long as they satisfy the conditions prescribed for availing such abatement. 3.5 The learned Additional Commissioner (AR) appearing for the Revenue, reiterates the findings recorded by the adjudicating authority. 4. We have carefully considered the rival submissions. 4. The issue involved in this case relates to interpretation of notification no. 15/2004-ST dated 10.09.2004 and notification no. 1/2006-ST dated 01.03.2006. These notifications are reproduced below: NOTIFICATION NO 15 /2004- Service Tax, DATED : September 10, 2004 In exercise of the powers conferred by su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption shall not apply in such cases where the taxable services provided are only completion and finishing services in relation to building or civil structure, referred to in sub-clause (c) of clause (25b) of section 65 of the Finance Act. Explanation.- The gross amount charged shall include the value of goods and materials supplied or provided or used by the provider of the construction service for providing such service. 33 Provided that this notification shall not apply in cases where, - (i) the CENVAT credit of duty on inputs or capital goods or the CENVAT credit of service tax on input services, used for providing such taxable service, has been taken under the provisions of the CENVAT Credit Rules, 2004; or (ii) the service provider has availed the benefit under the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.12/2003-Service Tax, dated the 20th June, 2003[G.S.R. 503 (E), dated the 20th June, 2003]. Explanation.- For the purposes of this notification, the expression "food" means a substantial and satisfying meal and the expression "catering service" shall be construed accordingly." 4.2 A plain read ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e abatement benefit is availed under notification 15/2004 or 1/2006, without taking CENVAT credit on inputs or capital goods or input service and service tax liability is discharged on the reduced value, whether for the purpose of discharge of service tax liability, accumulated CENVAT credit arising from some other case/contract can be utilized or not. In our view, there is no such bar or restriction/prescribed in the notification. The notification only stipulates that in respect of a case/contract, where abatement is availed, no CENVAT credit on inputs, capital goods or input services shall be taken. So long as this condition is satisfied, abatement is permissible. Discharge of service tax liability on the non-abated portion of value is a totally different matter. Hence there is no bar/restriction in discharging service tax liability through accumulated CENVAT credit so long as no CENVAT credit is taken on the inputs/capital goods or input services used in the rendering of the service in the given case or contract and we hold accordingly. 4.5 In the light of the above, the interpretation of law taken by the lower adjudicating authorities are not correct in law and, therefore, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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