Home Case Index All Cases Service Tax Service Tax + AT Service Tax - 2015 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (7) TMI 855 - AT - Service TaxDisallowance of Composition Scheme for works contract service - benefit of 67% abatement under Notification No. 1/2006-S.T. - Availment of Cenvat credit of input services - whether for ongoing contracts which commenced prior to 1-6-2007 and Service Tax was paid under respective services, Composition Scheme could be availed of with effect from 1-6-2007 classifying the service under works contract service has been decided by Andhra Pradesh High Court in the case of Nagarujuna Construction Ltd. holding that for such ongoing contracts, the assessee cannot switch over to Composition Scheme - Held that:- There can be no doubt that the classification of service is to be determined in terms of the nature of service rendered vis-à-vis the definition of various services as applicable on the date of rendition of service. The Board’s circular dated 4-1-2008 is in disharmony with law to the extent it holds that with effect from 1-6-2007 the classification cannot be changed for ongoing projects even if the service rendered is more specifically covered thereunder. Thus even if the classification of service prior to 1-6-2007 in respect of ongoing contracts was under CICS/CCS, the same would be classifiable as works contract service (WCS) with effect from 1-6-2007 if the service rendered was more specifically covered thereunder and if the classification is held to be under WCS the benefit of Notification No. 1/2006-S.T. would not be applicable with effect from 1-6-2007 as the said notification is not applicable to works contract service. However, the benefit of Rule 2A of the Service Tax (Determination of Value) Rules, 2006 or any other applicable notification can be claimed by the appellants subject to producing the required evidence. As regards denial of the benefit of abatement under Notification No. 1/2006-S.T. on the ground that the appellants had taken Cenvat credit in respect of input services, it is to be pointed out that the said notification does not debar availment of Cenvat credit on input services. - Decided in favour of assessee
|