TMI Blog2012 (2) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... e prima facie, do not see any reason to hold that the payment made through Cenvat credit during the period of default cannot be considered as good payment - Following decision of CCE v. Saurashtra Cements - [2010 (9) TMI 422 - GUJARAT HIGH COURT] has held that in such situation penalty under Rule 27 of Central Excise Rules only will apply which will be a small amount only - Conditional stay granted. - E/1577/2011 - Stay Order No. 325/2012-EX(BR)(PB) - Dated:- 10-2-2012 - Ms. Archana Wadhwa and Shri Mathew John, JJ. Shri Bipin Garg, Advocate, for the Appellant. Shri R.K. Verma, AR, for the Respondent. ORDER The Appellants are manufacturers of excisable goods and they were paying excise duty as per the provisions of Rule 8 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue issued Show Cause Notice for recovering all the excise duty shown to be paid by them using Cenvat credit during the defaulting period and a Show Cause Notice was issued demanding duty amounting to Rs. 28,19,120/-. Further, penalty under Rule 25 and Rule 27 of the Central Excise Rules were also proposed. The matter was adjudicated by confirming the said demand along with appropriate interest. Further, a penalty of Rs. 2 lakhs was imposed under Rule 25 of Central Excise Rules and penalty of Rs. 5000/- was imposed under Rule 27 of the Central Excise Rules, 2002. Aggrieved by the order, the Appellants filed an Appeal with the Commissioner (Appeals) he did not give any relief. Aggrieved by the order of the Commissioner (Appeals), the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsequences under Cenvat Credit Rules, 2004 will follow. That is to say the assessee is entitled to take credit during the defaulting period. The only consequence of Rule 8(3A) can be that payment through Cenvat credit cannot be the proper discharge of duty liability when the default continues. But once the default is made good, along with interest we prima facie, do not see any reason to hold that the payment made through Cenvat credit during the period of default cannot be considered as good payment. Therefore, at this prima facie stage, we consider that the consequences that will follow are that the Appellants should pay interests as follows :- (1) Interest on the initial defaulted amount making the assessee to be defaulter from th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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