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Ongoing works contract before 1-6-2007;reclassified under works contract service
Ongoing works contract before 1-6-2007;reclassified under works contract service
Ongoing projects of construction services commenced before 1/6/07, assessee sought reclassification under works contract services & opted for composition scheme, circular dated 4/1/08 was incorrect. CESTAT held that if reclassification is made, assessee can't switch over to Composition Scheme & assessee can't avail abatement under Notification No. 1/2006-ST but benefit of valuation rule 2A ibid would be available subject to documentary evidences.-007549
1. Ongoing projects of 'construction services' commenced prior to 1-6-2007, assessee sought reclassification under works contract services and opted for composition scheme.
2. Department denied reclassification as well as composition scheme and also denied abatement under Notification No. 1/2006-ST, as credit of input services was taken.
3. Classification is determined with reference to law as it stands on date of providing service; hence, assessee may seek reclassification under Works Contract Services and to said extent, Circular dated 4-1-2008 was incorrect.
4. HELD- CESTAT held that if reclassification is made under works contract services, then, assessee cannot switch over to Composition Scheme and assessee cannot avail abatement under Notification No. 1/2006-ST but benefit of valuation rule 2A ibid would be available subject to documentary evidences.
5. Hence, matter was remanded back for re-adjudication. [Partly in favour of assessee/Matter remanded]
Case Reference- Ahluwalia Contracts (I) Ltd. v. Commissioner of Central Excise, Noida
(CESTAT, NEW DELHI BENCH)
[2015] 58 taxmann.com 281 (New Delhi - CESTAT)
