TMI Blog2014 (7) TMI 1165X X X X Extracts X X X X X X X X Extracts X X X X ..... ts 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot allowed abatement of 67% under Notification No. 1/2006-S.T. on the ground that they had taken Cenvat credit of the input services. As a result the aforesaid demand was confirmed by the adjudicating authority along with interest for the period June 2007 to September 2010. The adjudicating authority also held that such re-classification and availment of Composition Scheme was done by the appellants with fraudulent intention of evading service tax and consequently penalties including mandatory penalty was also imposed. 3. The appellants have contended that once Works Contract Service was introduced with effect from 1-6-2007 and as their service was more specifically covered thereunder, it was correct on their part to switch over to the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Works Contract Service and therefore the re-classification on their part prima facie was as per law. The appellants prima facie may be on weak footing regarding their eligibility for the Composition Scheme (contained in Notification No. 32/2007-S.T.) for the on-going projects (i.e. the continuing projects which began prior to 1-6-2007) in view of the conditionalities contained therein but this will need more thorough analysis of the evidence available to arrive at a finding in that regard. However, this is not necessary for the purpose of deciding the stay application as will become evident from what follows. 6. The adjudicating authority has disallowed re-classification of the on-going contracts under Works Contract Service with effec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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