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2015 (4) TMI 382 - HC - Central ExciseCENVAT Credit availed wrongly on Capital goods - presence of Mens rea or guilt - Imposition of penalty - Held that:- In cases where the CENVAT credit in respect of capital good has been taken or utilized wrongly on account of fraud, willful misstatement, collusion or suppression of fact or contravention of any provision of the Act or Rules made thereunder, with an intention to evade payment of duty then only penalty is liable to be imposed. - It is the case of the assessee that by taking benefit of this judgment the credit facility was availed of. However, in doing so, it cannot be said that the credit facility in respect of the capital good was wrongly used on account of fraud, willful misstatement, collusion or suppression of fact. It is also not an intentional contravention of any statutory provision. At best it may amount to misunderstanding the law and its applicability and in the absence of any mens rea on the part of the assessee, if two Appellate Authorities namely the Commissioner and the Appellate Tribunal found that imposition of penalty in the instant case is not called for as there is no sufficient evidence to prove Mens rea or guilt on the part of the assessee, we see no reason to interfere with such a reasonable approach adopted by Appellate authorities concurrent in nature. Imposition of penalty that also equal to the amount of the credit facility availed of in a penal consequence and a penal consequence is to be enforced only when the conduct of the assessee shows certain positive action indicating fraud, misstatement collution etc.. This action of the assessee may be in contravention to the statutory provision but it was with a bonafide reason or belief by interpretation of a judgment of a High Court, then the imposition of penalty in such circumstances was not warranted. The Appellate Authority and the Appellate Tribunal in para 5 of the impugned order has dealt with the matter in detail and when the discretion has been exercised finding there to be no ill intention, malafide or collusion on the part of the Assessee in availing of the facility, we are not inclined to interfere into the matter as no substantial question of law is involved in the matter. - no case made out for interferring with the concurrent findings recorded by the authorities, the appeal is dismissed at the stage of admission itself. - Decided against Revenue.
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