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2012 (11) TMI 404 - SC - Service TaxWorks contract service - denial of option to pay service tax under the Composition Scheme for old contracts - Validity of the Circular No. 98/1/2008-ST, dated 4.1.2008 - Held that:- Impugned Circular has only explained the contents of Rule 3 (3) of the 2007 Rules so as to provide guidelines to the Revenue Officers. On perusal of Rule 3 (3) of the 2007 Rules it is very clear that the assessee who wants to avail of the benefit under Rule 3 of the 2007 Rules must opt to pay service tax in respect of a works contract before payment of service tax in respect of the works contract and the option so exercised is to be applied to the entire works contract and the assessee is not permitted to change the option till the said works contract is completed. In the instant case it is an admitted fact that the assessee had already paid service tax on the basis of classification of works contract which was in force prior to 1st July, 2007. In the circumstances, it cannot be said that the appellant had exercised a particular option with regard to the mode of payment of tax after 1st July, 2007 with regard to reclassified works contract. Thus in agreement with the submissions made by the respondents that not availing of CENVAT credit is absolutely irrelevant in the instant case. We do not accept the submission of the learned counsel appearing for the appellant that the Impugned Circular is discriminatory in nature. The Impugned Circular is not contrary to the Act or the statutory rules made thereunder and the Impugned Circular only provides guidelines as to how the provisions of Rule 3 (3) of the 2007 Rules are to be interpreted. Even if the Impugned Circular is set aside, the provisions of Rule 3 (3) of the 2007 Rules would remain and that would not benefit the appellant. Thus the High Court did not commit any error while upholding the Impugned Circular and, therefore, appeal dismissed - against assessee.
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