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2014 (7) TMI 1165 - AT - Service TaxDisallowance of 67% abatement under Notification No. 1/2006-S.T - re-classification of the services - waiver of impugned demand, interest and penalties and stay recovery thereof - Held that:- On perusal of Notification No. 1/2006 it is evident that for the purposes of 67% abatement, the condition of non-availment of Cenvat credit is prescribed only in respect of inputs and not in respect of input services. Thus Commissioner has completely misread the provisions of said notification to disallow abatement of 67% under the said notification. As regards re-classification of the services rendered by the appellants after introduction of Works Contract Service, it is trite to say that the service rendered has to be classified as per the provisions applicable on the date of delivery of service. It is not disputed that from 1-6-2007 the service rendered by the appellants categorically fell under the category of Works Contract Service and therefore the re-classification on their part prima facie was as per law. The appellants would be entitled to 67% abatement under Notification No. 1/2006-S.T. The service tax payable after allowing 67% abatement will reduce to 33% of the amount of demand confirmed. Service Tax @ 4% under the Composition Scheme also works out to approximately in the same range. Further in such a scenario, the sustainability of the allegation of suppression/wilful mis-statement can also, prima facie, be in serious jeopardy. Thus the appellants have made out a good case for waiver of pre-deposit
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