TMI Blog2003 (4) TMI 477X X X X Extracts X X X X X X X X Extracts X X X X ..... y paid on the inputs as well as capital goods; that they have filed necessary declaration both for inputs and capital goods in time; that they have filed RT 12 returns along with copies of invoices on the basis of which Modvat credit had been availed of by them; that during the course of audit, the audit party alleged that Modvat credit amounting to Rs. 78,45,141/- has been wrongly availed of; that the appellants had debited the entire amount during the period October, 1998 to July, 1999 though the show cause notice was issued to them only on 14-3-2000. He, further, submitted that the Department could not allege any suppression or fraud or wilful misstatement with an intent to evade the payment of duty as they had regularly filed RT 12 retu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied that Modvat credit should not be disallowed on minor procedural lapse and before disallowing the credit the Assistant Commissioner shall conduct inquires with regard to duty paid nature of the goods and satisfies himself that the goods had been used or are intended to be used as contemplated in the Modvat Rules; that finally the amount of Rs. 29,204/- has been disallowed as the Modvat credit has been taken in respect of HSD. The learned Advocate, contended that substantial portion of the Modvat credit which has been disallowed to them was infact available to them under the law but they had reversed the same as a law abiding citizen on being pointed out by the audit party; that moreover more than Rs. 33 lakhs credit which was wrongly ava ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for confiscation the present concerned with that shall be liable to penalty up to the amount specified in the Rule. It is difficult to accept the argument of the Appellants that levy of penalty is discretionary. It is only the amount of penalty which is discretionary. Accordingly, we hold that penalty is imposable on the Appellants. However, we observe that the fact of Appellants filing RT 12 returns along with invoice or bill of entry on the basis of Modvat credit had been taken by them, has not been disputed by the Revenue. This fact coupled with the fact that entire amount has been reversed by them immediately after being pointed out by the audit party. Penalty equal to the amount of Modvat credit disallowed is not warranted in the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X
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