Abatement cannot be denied

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has reaffirmed that substantive tax benefits cannot be denied merely because an assessee failed to specifically claim them in statutory returns. 

The Tribunal held that where the use of materials in execution of construction contracts is undisputed, the benefit of 67% abatement under Notification No. 1/2006-ST cannot be refused solely on procedural grounds. 

Since the appellant had already paid service tax in excess ofthe liability computed after granting the permissible abatement, the demand, interest and penalty were held to be unsustainable and were consequently set aside.