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2024 (1) TMI 1058 - AT - Service TaxEligibility for abatement of 67% of gross value under the Notification No. 1/2006-ST - Classification of services - Commercial and Industrial Construction Service - Finishing and Completion work or not - works executed by the appellant in the nature of false ceiling, partitions, flooring, modular systems, painting, carpeting, electrical connected works wall paneling, supply and fixing of various furniture, brick works etc. - HELD THAT:- There is ample evidence to show that the appellant has used goods and materials in construction service which are composite in nature. So also, from the different work orders we have no confusion to conclude that these are not completion and finishing service so as to get excluded from the ambit of Notification No. 1/2006-ST. It also requires to be mentioned that the Tribunal in its earlier Final Order dated 02.07.2014, had remanded the matter with specific direction to the Adjudicating Authority to verify and scrutinize documents furnished by the appellant with regard to their claim of abatement in spite of such directions, the Adjudicating Authority has denied the benefit of abatement with observing that appellant has not produced details of site-wise/ bill-wise for the purchase of materials. This observation is highly erroneous and not acceptable. The Tribunal while analyzing a similar situation in the case of M/S. OCEAN INTERIOR LIMITED VERSUS COMMISSIONER OF G.S.T. & CENTRAL EXCISE, CHENNAI [2019 (11) TMI 124 - CESTAT CHENNAI] observed that when there is sufficient evidence to establish that the appellant has purchased materials for execution of work and also paid VAT on such goods, the department cannot deny abatement and demand service tax on entire gross amount received. In the present case also, the appellant has produced VAT returns to show that they have paid VAT on the materials used in the execution of work orders. Similarly in the case of M/S RAJ INTER DECOR PRIVATE LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, AND SERVICE TAX, DELHI-III [2023 (7) TMI 1180 - CESTAT CHANDIGARH] the Tribunal while considering the eligibility of abatement of 67%, as per Notification No. 01/2006-ST held that in case of construction services of composite nature, abatement has to be granted. Thus, appellant has used goods and material for execution of construction work. The allegation of the department that the works are entirely ‘Completion and Finishing service’ is factually and legally incorrect - the appellant is eligible for abatement. Following the ratio of decisions cited, it is opined that the demand raised cannot sustain. Accordingly the impugned order is set-aside. Appeal allowed.
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