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TMI Blog2015 (2) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification No.1/2006-ST) only credit of input and capital goods is not permissible. Thus there is variance between the Show Cause Notice and the adjudication order with regard to whether the appellants took CENVAT credit of only input services or both inputs and input services (and also capital goods) which needs to be reconciled. But even with the classification of the impugned service under works contract service w.e.f. 01.06.2007, the appellants will not be eligible for the compositional scheme to pay service tax under works contract service in respect of on-going projects for which service tax had been paid during the period prior to 01.06.2007. It has been so held upto the level of the Supreme Court in the case of Nagarjuna Construction Co. Ltd. Vs. GoI [2012 (11) TMI 404 - SUPREME COURT]. - However, that would not disqualify the appellants from claiming the benefit under Rule 2A of Service Tax (Determination of Value) Rules, 2006 or any other exemption Notification provided they satisfy the conditions and establish their eligibility. Levy of service tax on construction of flats made for Delhi Development Authority (DDA), buildings constructed for BSNL, Reliance or Municipa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oject on the ground that these were not commercial or industrial constructions and the construction of flats for DDA being for DDA s use were not liable to service tax under construction of complex service. The service tax (except the one related to DDA) was also not paid on the Karnataka Project and NSG Hqrs. Delhi on the ground that they were government/non-commercial project. The adjudicating authority disallowed the benefit of Notification No. 15/2004-ST,/18/2005-ST/ 1/2006-ST on the ground that the value of the free supplies had not been included in the value for the purpose of claiming the abatement. The composition scheme benefit was disallowed on the ground that they had started taking the benefit of composition scheme in respect of projects which were on-going before 01.06.2007 and also because they had taken/utilised Cenvat credit on inputs and input services. As regards the construction service rendered to BSNL, NDMC, Reliance and Dr. B.L. Kapur Memorial Hospital, the adjudicating authority held that the buildings qualified to be commercial or industrial construction. As regards construction of residential buildings for DDA, as they were not meant for self use ( i.e. for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... how Cause Notice it is mentioned that they started availing of the input service credit with effect from 01.06.2007 (para 16 of the Show Cause Notice) while in the adjudication order it is stated that they took CENVAT credit of input and input services. In this regard, we find that for 67% abatement under the aforesaid Notifications (except Notification No.1/2006-ST) only credit of input and capital goods is not permissible. Thus there is variance between the Show Cause Notice and the adjudication order with regard to whether the appellants took CENVAT credit of only input services or both inputs and input services (and also capital goods) which needs to be reconciled. The adjudicating authority has stated that for the on-going projects, the classification could not be changed to Works Contract service with effect from 01.06.2007. In this regard, it is to state that the classification of a service depends upon its nature vis-a-vis the definitions of various services contained in Section 65 of the Finance Act, 1994. Thus, there is absolutely no legal bar, indeed it is legally required, to re-classify the service if it gets more specifically cover under the new or newly carved out se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,935/-, the adjudicating authority has merely stated in para 91 of the adjudication order as under:- "It is observed that the party has availed Cenvat Credit of inputs, Input Service and credit received from Input Service Distributor amounting to ₹ 49,25,935/- (Rupees Forty Nine Lakhs Twenty Five Thousand Nine Hundred Thirty Five only). I find that the party has wrongly availed and utilised this inadmissible Cenvat Credit towards discharging their Service Tax liability under Works Contract Service. The plea that they had a bonafide belief is misplaced. Hence, it is concluded that the Noticee had contravened the said provisions with the intention not to pay Service Tax at the appropriate time. Thus, the Show Cause Notice in the instance case, is correctly issued for demand and recovery of the said Cenvat Credit by invoking the provisions of Section 68 & 73 of the said Act read with Rule 6(1) & (2) of Service Tax Rules, 1994 ibid for contravention of the said provisions of the said Act and the Rules ibid with intent to evade payment of the said Service Tax." It is evident from the above para that adjudicating authority has simply declared the impugned credit to be inadmissibl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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