#abatement

CESTAT Chennai holds that businesses claiming abatement on services like outdoor catering under Notification 1/2006-ST can still claim full Cenvat credit on common inputs, as long as those inputs are not used exclusively for exempt services. This resolves a long-standing ambiguity for hospitality and service providers, affirming that abatement and credit are not mutually exclusive under the Cenvat framework.

CESTAT Kolkata holds that 67% service tax abatement under Notification No. 1/2006-ST cannot be denied merely due to procedural lapses like non-claim in ST-3 returns. The ruling reinforces that substantive benefits under tax laws prevail over technical non-compliance, impacting construction and works contract service providers.

CESTAT Chennai rules that abatement for trade discounts in jewellery trade can be granted based on consolidated sales data and Chartered Accountant certificates, without requiring transaction-wise correlation. This eases compliance burdens for manufacturers adopting provisional assessments under Rule 7 of Central Excise Rules, particularly in industries with fluctuating prices and indirect sales channels.