- (1.) The instant appeal is directed against the order dated 18-1-2012 passed Customs, Excise and Service Tax Tribunal, New Delhi.
(2.) The brief facts noticed for disposal of this appeal are that the respondent assessee is engaged in providing Erection, Commissioning and Installation Service as defined under Section 65(105)(zzd) of the Finance Act, 1994. During the course of audit it had been observed by the Audit Party that they had provided Erection, Commissioning and Installation Service during the financial years 2007-08 and 2008-09 (up to September, 2008) and availed abatement of Rs. 2,12,58,860/- in terms of Notification No. 1/2006-S.T., dated 1-3-2006 and simultaneously taken and utilized the Cenvat credit amounting to Rs. 2,06,541/- on the input services during the said period. It was noticed that the exemption Notification No. 1/2006-S.T. shall not apply where, - (i) the Cenvat credit of duty on inputs or capital goods or the Cenvat credit of service tax on input services, used for providing such taxable service, has been taken under the provisions of the Cenvat Credit Rules, 2004; or (ii) the service provider has availed the benefit under the Notification No. 12/2003-S.T., dated 20-6-2003. Since the respondent assessee had availed and utilized Cenvat credit under the provisions of Cenvat Credit Rules, 2004, the benefit of abatement under Notification No. 1/2006-S.T. was admissible in terms of proviso quoted hereinbefore and it was noticed that the assessee has contravened the condition of the provisions of the said notification. A show cause notice was issued by the Superintendent of Service Tax Range to deposit the service tax so short paid by them and immediately on receipt of the show cause notice, the assessee deposited the Cenvat credit amounting to Rs. 2,06,541/- along with interest of Rs. 17,093/- taken on input services by them vide GR-7 Challan, dated 3-3-2009.
(3.) However, the adjudicating authority was satisfied and held that it was only when the Audit Party took into consideration the wrong availment of Cenvat credit that the assessee deposited the same knowing fully well that the claim earlier made was in accordance with law, accordingly the AA confirmed the service tax, interest as also penalty subject to maximum of the due sales tax demand.;