TMI Blog2003 (10) TMI 362X X X X Extracts X X X X X X X X Extracts X X X X ..... karni, Advocates, for the Appellant. Shri K.K. Srivastava, DR, for the Respondent. [Order]. Heard both sides. The short issue to be decided in this matter is charge of interest and levy of penalty on the appellants who had availed Modvat credit on Capital goods and also depreciation under the Income-tax Act for the years 1996-97 and 1997-98. The credit availed was deposited on March ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ectively from 23-7-1996 and hence the interest becomes chargeable only from that date. On this point, I feel constrained to accept their plea and therefore the interest confirmed in the impugned order is reduced by Rs. 34,310.52 (i.e. Interest @ 18% for two years on the Modvat credit amount of Rs. 95,307/- wrongly availed during the period from April, 96 to June, 96). As regards penalty imposed, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Advocate, therefore should not be upheld and the appeals deserves to be rejected. 4. I find that non-mention of a rule or section would not be fatal to a notice, if the fact leads to understanding the same, is well settled law. The appellants are a professionally managed company and should have known the law of ineligibility of Modvat credit if depreciation under Income-tax was claimed. They h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to why imposition of 100% mandatory penalty has been called. In the present case the appellants have availed and utilised the credits. They are being held liable for interest. The penalty imposed is therefore reduced to Rs. 50,000/- only keeping in mind the payments made and the period involved in this case. Interest is confirmed as to be worked out under rules. 6. Appeal allowed in above term ..... X X X X Extracts X X X X X X X X Extracts X X X X
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