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2017 (5) TMI 281 - AT - Central ExcisePenalty - interest - CENVAT credit - countervailing duty paid on the raw materials imported - the said imported raw material could not have been consumed due to quality problems and they discharged appropriate customs duty, countervailing duty on the raw material imported by the appellant and availed CENVAT credit of the duty paid, which was reversed on being pointed out - Held that: - Imposition of penalty under Rule 15 of the CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 is incorrect, inasmuch as the said Rule starts that penalty can be imposed by invoking the extended period only if ineligible CENVAT credit is availed with an intent to evade duty - the imported goods has not been utilised by the appellant with intent to evade payment of duty, the provisions of Section 11AC read with Rule 15 of the CCR, 2004 does not apply in this case - penalty set aside. As regards the interest, the appellant requires to discharge interest - The Hon'ble apex Court in the case of Union of India v. Ind-Swift Laboratories Ltd [2011 (2) TMI 6 - Supreme Court] has held that interest liability arises even if the CENVAT credit is not utilised - interest demand upheld. Appeal allowed - decided partly in favor of assessee.
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