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2018 (6) TMI 235 - AT - Central ExcisePenalty u/s 11AC of CEA, 1944 - trading activity of bought out items - CENVAT credit in respect of common input service - The case of the department is that the appellant was supposed to reverse the CENVAT credit under Rule (3A) of the CCR 2004 attributed to the trading activity being an exempted service - applicability of Rule 14 - Held that:- As per Rule 6(3A), it can be seen that the only requirement is to pay the proportionate cenvat credit along with interest @ 24%. There is no provision for imposition of penalty. Rule 14 is applicable only in case where the cenvat credit is wrongly taken and utilized. In the present case, it is not a case of wrong availment/utilization of cenvat credit but the demand under Rule 6(3A). Therefore, Rule 14 is not applicable - there is no specific provision unlike in the case of duty evasion or wrong availment of credit for imposition of penalty under Section 11AC. Revenue relied upon the case of Bajaj Hindustan Ltd. [2013 (3) TMI 365 - ALLAHABAD HIGH COURT], where the issue was that the appellant had wrongly availed the CENVAT credit - the case is entirely different and do not apply to the present case. The penalty was wrongly imposed under Section 11AC - appeal allowed - decided in favor of appellant.
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