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2014 (7) TMI 315 - AT - Central ExciseDenial of CENVAT Credit - Merger of companies - Held that:- as on 20/02/2000 when the appellant applied for fresh registration, the High Court order approving the merger of the appellant company with Vivada had already been received and it took effect from 1st March 2000 itself. That being the position, there was no need for the stores clerk to have change the name since once the High Court approved the date of merger from that date merger said to have taken effect and therefore the credit was admissible. The stores clerk in his anxiety to ensure that appellant does not lose MODVAT credit and without proper knowledge of law has resorted to this. That being the position, I find myself in agreement with the view taken by the Commissioner(Appeals) in the impugned order that for a mistake committed by the stores clerk without proper appreciation of the legal position, the denial of entire CENVAT credit is not appropriate. Once the credit taken is held to be admissible and not denied, the question of demand of interest also would not arise and therefore the demand for interest also has to be set aside. Penalty u/s 11AC - Held that:- CENVAT credit would not have been demanded and interest also would not have been demanded. The penalty under Rule 57AH read with Section 11A is imposable only when suppression of facts, omission etc. invoked and demand for CENVAT credit is confirmed. When there is no demand for CENVAT credit under the extended period by invoking Rule 57AH(2), imposition of penalty under Section 11AC may not be imposable. At this stage, it would be appropriate to take note of the fact that penalty of ₹ 10,000/- under Rule 173Q was also imposed against the appellant which is not at all challenged. That being the position, penalty under 173Q can be attributed to the manipulation of the invoice done by the store clerk and therefore, in my opinion, non-imposition of penalty of ₹ 50,000/- on the appellant by this Tribunal is correct - Penalty cannot be sustained - Decided in favour of assessee.
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