Wrongly availed cenvat credit

[OM PRAKASH]

CENVAT CREDIT WRONGLY TAKEN WHILE AVAILING 50% ABATENMENT UNDER NOTF.1/2006. CAN THE AUDIT WING OF SERV. TAX DISSALLOW THE ABATEMENT? POSSIBLE LIAB. 22 LACS, CENVAT CREDIT 70,OOO

[sudhir V S]

Dear Mr. Om prakash, The best way to get out of the issue would be revesal/payment of service tax along with the interest of 13% p.a. once the service tax has been paid the benifit under notification 1/2006 should not be denied in my view

[Guest]

I accept the below view also if you pay service before audit with interest you may be not penalised for voluntrly payment, also see that revised return should be filed with in due date as per recent notification/circular.

AI Summary

Query on Wrongly Availed CENVAT Credit Under Notification 1/2006; Solutions Include Reversal, Interest Payment, Revised Returns An individual raised a query about wrongly availed CENVAT credit while claiming a 50% abatement under Notification 1/2006, questioning if the Service Tax audit wing could disallow the abatement, with a potential liability of 22 lakhs and CENVAT credit of 70,000. Two responses were provided: one suggested reversing or paying the service tax with 13% annual interest to retain the abatement benefit, while the other agreed, advising payment before audit with interest to avoid penalties and filing a revised return within the due date.