2017 (8) TMI 1230

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.... the ground that appellant have availed the Cenvat credit in respect of capital goods. 2. Shri. Sanjay Apte, Ld. Counsel appearing on behalf of the appellant submits that show cause notice was issued in pursuance to the audit objection regarding short payment of service tax for an amount of Rs. 43 lakhs approximately. However, while issuing show cause notice, the entire receipt from the balance sheet presumed to be escaped from payment of service tax. He submits that appellant for the entire period discharged the service tax on regular basis partly in respect of Site Formation Service and partly on Commercial or Industrial Construction Service after taking abatement in term of Notification No.1/2006-ST, accordingly, entire service tax wa....

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....partly it was covered in works contract service and partly covered under commercial or industrial construction service. The appellant have correctly discharged service tax, therefore entire demand raised in the show cause notice and adjudicated by the Commissioner is without verifying the fact of payment of service tax on regular basis, nature of service, availability of the notification No.1/2006-ST. 3. On the other hand, Shri. M.K. Sarangi, Ld. Addl. Commissioner(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order. 4. We have carefully considered the submissions made by both sides and perused the record. 5. We find that as submitted by the appellant, the entire service tax on the gross value of ....

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....incorrect as there is no restriction in availing Cenvat credit on capital goods in order to avail exemption notification no.1/2006-ST or under works contract composition scheme, therefore appellant not violated any condition, hence the abatment availed by them is correct and legal. As regard the issue of 100% Cenvat credit availed on capital goods, we find that as per the provision, the appellant was supposed to take credit of Cenvat credit of only 50%, however in the subsequent financial year remaining 50% credit was available. In the present case there is no case of demand of Cenvat credit of 50% however as per Hon'ble Supreme Court judgment in case of Union of India Vs. Ind-Swift Laboratories Ltd[2011 (265)ELT interest is chargeable ....