Appellant entitled to 75% abatement from taxable value despite CENVAT Credit reversal.

The Tribunal held that the appellant was entitled to the benefit of the 75% abatement from taxable value under Notification No. 01/2006-ST despite initially availing and later reversing the CENVAT Credit. The decision was based on established legal principles and previous judgments supporting the allowance of the benefit in such cases. The order-in-appeal denying the abatement was set aside, and the appeal was allowed.

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Issues Involved:
The appeal challenges the order-in-appeal regarding denial of 75% abatement from taxable value due to availing Cenvat Credit and subsequent reversal, leading to a demand of Rs. 23,31,054/- of Service Tax along with interest and penalty.

Issue 1 - Benefit of Abatement:
The main issue is whether the appellant can be denied the benefit of 75% abatement from taxable value under Notification No. 01/2006-ST despite reversing the CENVAT Credit availed earlier.

The Tribunal observed that the appellant had initially availed CENVAT credit but later reversed it in a revised return, meeting the condition of non-availment for the abatement. Various decisions, including the case of Punj Lloyd Limited vs. Commissioner of C. Ex. & ST., Rohtak, supported the view that reversal of credit suffices for availing the benefit of the notification. The judgment of Allahabad High Court in the case of Hello Minerals Water (P) Ltd. vs. Union of India also emphasized that reversal of credit amounts to non-taking of credit, entitling the assessee to the benefit of the notification. The Tribunal held that the denial of the benefit was not sustainable, setting aside the order under challenge and allowing the appeal.

Conclusion:
The Tribunal concluded that the appellant was entitled to the benefit of the 75% abatement from taxable value under Notification No. 01/2006-ST despite initially availing and later reversing the CENVAT Credit. The decision was based on established legal principles and previous judgments supporting the allowance of the benefit in such cases.

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