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2022 (7) TMI 713 - CESTAT AHMEDABADLevy of penalty - fraudulent passing of CENVAT Credit - in the LR the destination was shown as Daman/Silvassa whereas the goods were admittedly delivered at Bhiwandi - HELD THAT:- The penalty under Rule 26 was imposed upon the appellant for an amount of Rs. 3 Lakh on the alleged charge that the appellant being transporter has issued an incorrect LR knowingly showing the destination Daman/Silvassa but the goods were delivered at Bhiwandi. It is found that the adjudicating authority imposed the penalty on the ground that the appellant dealt with the goods which were liable for confiscation. From the plain reading of Rule 26 it is clear that the appellant’s offence falls under Rule 26 (2)(ii) of Central Excise Rules, 2002 as the appellant had issued incorrect LR in respect of goods on which the fraudulent credit was availed by M/s. Taha wires. The aforesaid amended Rule 26 came into effect from 01.04.2007 whereas in the present case period involved is 2004-2005, 2005-2006, 2006-2007 (upto December, 2006) - Since the appellant’s case falls under Rule 26 (2) (ii) but the same is not existing at the relevant time the appellant cannot be penalized when the goods dealt with by him was not liable for confiscation on the ground that the same was admittedly duty paid. The penalty is not sustainable hence, the same is set aside - Appeal allowed - decided in favor of appellant.
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