CESTAT held that the MOU between the appellant and the power...

CESTAT held that the MOU between the appellant and the power utility was essentially for procurement of fly ash and did not constitute a service agreement for installation, operation or maintenance of the fly ash collection system. The Tribunal ruled that the contract must be interpreted based on the parties' expressed intention, and in absence of any allegation of fraud or camouflage, the mutually agreed consideration could not be recomputed or enhanced by extrapolating rates to the entire fly ash generated. It further held that service tax paid by the sub-contractor on repair and maintenance of the fly ash system was rightly availed as input credit by the appellant. Consequently, the demand, including extended period, interest and penalties, was unsustainable. The impugned order was set aside and the appeal allowed.