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2016 (3) TMI 473 - AT - Central ExciseDemand of interest and penalty - reversal of Irregularly availed cenvat credit - Held that:- In the present case, since taking of credit is a mere book entry and the same has not been utilized by the appellant, the question of compensating the Government does not arise because there is no loss of Revenue to the Government exchequer. With regard to the payment of interest for late reversal of cenvat credit. The Hon'ble Karnataka High Court in the case of CCE & ST, LTU, Bangalore- vs Bill Gorge (P) Ltd. reported in (2011 (4) TMI 969 - KARNATAKA HIGH COURT ) has held that the credit taken if not utilized for payment of Central Excise duty, the same bears the character of a mere book entry and the interest liability cannot be confirmed against the assessee. Thus demand of interest is not proper and justified in the present case, because the cenvat credit taken by the appellant irregularly has not been utilized for clearance of final product. Section 11A of the Central Excise Act, 1944, was substituted w.e.f. 08.04.2011 by section 63 of the Finance Act, 2011. The effect of substitution is that sub-section (6) was inserted in section 11A. Since, the period involved in the case in hand is from December, 2010 to March 2011, the provisions of sub-rule (6), inserted subsequently, will not have any application for imposition of penalty. Further, the provisions of Rule 15(1) of the Cenvat Credit Rules, 2004 have not been invoked in the SCN for imposition of penalty. Thus, the penalty confirmed by both the authorities below is outside the scope and purview of SCN. - Decided in favour of assessee
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