TMI Blog2013 (8) TMI 572X X X X Extracts X X X X X X X X Extracts X X X X ..... notice for imposing penalty on the appellant under Rules 15(4) - Following decision of CCE, Pune-I vs. Thermax Ltd. [2010 (1) TMI 460 - CESTAT MUMBAI] - Decided against assessee. - Appeal No.E/2114/2010 - 710/2012 - Dated:- 14-11-2012 - Mr. P.G. Chacko, J. For the Appellant: Mr. Joseph Prabhakar, Advocate For the Respondent: Mr. A.K. Nayak, Addl. Commissioner(AR) JUDGEMENT In this appeal filed by the assessee, the short question which arises for consideration is whether, under Rule 15(4) of the CENVAT Credit Rules, 2004, they are liable to be penalized on the facts of this case. The appellant has a manufacturing unit (Unit-I) at Isnapur and a service providing unit (Unit-II) at Bhadrachalam. During the period from April 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rules, 2004. The interest and penalty demanded by the adjudicating authority were paid up by the assessee. The non-imposition of penalty under sub-rule 4 of Rule 15 of the CENVAT Credit Rules, 2004 read with Section 78 of the Finance Act, 1994 by the adjudicating authority was reviewed in the Department and accordingly an appeal preferred to the Commissioner(Appeals). The learned Commissioner(Appeals) allowed that appeal by setting aside the penalty of Rs.2000/- imposed under Rule 15(3) and imposing penalty of Rs.4,98,899/- under Rule 15(4) on the assessee. This higher penalty is under challenge in the present appeal of the assessee. 3. Heard both sides. The learned counsel for the appellant submits that no ground for imposing penalty un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llenged by them, they are precluded from resisting penalty under Rule 15(4) read with Section 78. The arguments of the learned Additional Commissioner(AR) run in these lines. 5. I am not impressed with the above arguments put forth on behalf of the Department. Rule 15(4) of the CENVAT Credit Rules, 2004 reads as follows:- (4) In a case, where the CENVAT credit in respect of input services has been taken or utilized wrongly by reason of fraud, collusion, wilful mis-statement, suppression of facts, or contravention of any of the provisions of the Finance Act or of the rules made thereunder with intention to evade payment of service tax, then, the provider of output service shall also be liable to pay penalty in terms of the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunals decision in the case of Thermax Ltd. (supra) is squarely applicable to the facts of the instant case. Paragraphs 4 5 of the cited judgment are reproduced below:- 4. As rightly pointed out by the learned counsel for the respondents, none of the ingredients for a penalty under Section 11AC was expressly alleged in any of the show-cause notices. It is settled law that, where the department seeks to penalize a person on any of the grounds covered by the text of Section 11AC, they have necessarily got to allege such grounds and prove the same in adjudication of the case. In the absence of allegation of fraud, collusion, suppression of facts, wilful mis-statement of facts or contravention of rules with intent to evade payment of duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erein. The different sub-rules of Rule 15 cover different factual situations and, therefore, it was incumbent on the department to specify the particular sub-rule which they wanted to invoke in a particular show cause notice. However, this was not done in any of these cases. In the case of Amrit Foods v. CCE - 2005 (190) 433 (S.C.), the Hon ble Supreme Court had occasion to consider a similar case which arose under Rule 173Q of the erstwhile Central Excise Rules, 1944. Their Lordships noted that Rule 173Q contained six clauses, the contents of which were not the same. It was held that it was necessary for the assessee to be put on notice as to the exact nature of contravention for which they were liable under Rule 173Q. In that case, any pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
