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2014 (6) TMI 792 - CESTAT AHMEDABADDuty demand - Demand of differential duty - Reclassification of goods - Suppression of facts - Mis declaration of goods - Penalty - Availment of MODVAT Credit - Whether IOCL was eligible to pass on credit as per the provisions of Rule 57E of the Central Excise Rules, 1944 - Held that:- A perusal of the Tribunal’s Order does not suggest that the issue of passing of credit as per the provisions of Rule 57E, though raised by the appellant, was adjudicated by the Tribunal and have thus attained finality. This para only conveys Tribunal s observation that the issue could not be taken up by the Tribunal in view of limited scope of appeal filed by the appellant on the issue of imposition of penalty. Therefore, we agree with the Ld. Advocate of the appellant that this issue was not adjudicated by the Tribunal and thus the question of attaining its finality does not arise. It has thus to be held that impugned credit was admissible to IPCL. On the date of payment of differential duty on 09.02.2000, and also during the period of demand, erstwhile Central Excise Rules, 1944 were in force. The differential duty liability was cast on IOCL vide Order dated 25.08.1999 along with interest under Section 11AB and penalty under Section 11AC. Therefore, on receipt of the said order-in original dated 25.08.1999, also IOCL could not issue certificate in terms of Rule 57E of the Central Excise Rules, 1944 in force during material time on account of exception clause contained in the prevailing Rule 57E(3) of the Central Excise Rules, 1944 because penalty on account of suppression etc. under Section 11AC was imposed on IOCL by the adjudicating authority. IOCL paid differential duty of Rs.14,36,74,091/- on 09.02.2000 against OIO dated 25.08.1999 but filed an appeal with the CEGAT against imposition of interest and penalty. Certificate was issued by IOCL on 18.09.2006, and MODVAT Credit was taken by IPCL in November, 2006 as a result of prolonged litigation which ended only on 17.05.2005 as per the final order passed by CESTAT in the case of the appellant IOCL. In view of the above observations and the case law of CCE Vs. Oil & Natural Gas Limited (2012 (11) TMI 864 - CESTAT, MUMBAI) we hold in the peculiar facts and circumstances of these appeals that IOCL has correctly issued certificate dt. 18.09.2006 and IPCL has correctly taken credit. So far as imposition of penalties upon the appellants are concerned it is held that once on merit credit has been held to be admissible there is no point of imposition of penalties upon the appellants - Decided in favour of assessee.
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