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2013 (9) TMI 95 - MADRAS HIGH COURTPenalty u/s 11AC – Reversal of credit before issuance of SCN - Whether the Tribunal was correct in holding that demand of interest u/s 11 AB r.w. Rule 57 AH of the erstwhile Central Excise Rules 1944 /Rule 12 of the erstwhile Cenvat Credit Rules, 2001/Rule 12 of the Cenvat Credit Rules, 2002 was not payable if duty was paid before issue of Show Cause Notice notwithstanding delay in payment of Central Excise Duty – Held that:- The periodicity of such a default appeared to be more than once and in more than one case, the assessee had not observed the procedure prescribed and prevailed during the relevant period - Thus looking at the conduct of the assessee, the bona fides not thus established, the facts herein rightly called for levy of penalty - The Modvat credit irregularly availed was reversed prior to the show cause notice, does not afford a good defence of good faith and could not be sustained in law - CESTAT order to cancel the penalty could not be upheld - The assesse lacked bona fide, hardly any other material which the CESTAT considered to come to a different conclusion – Decided in favour of Revenue.
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