TMI Blog2013 (8) TMI 790X X X X Extracts X X X X X X X X Extracts X X X X ..... ds - The conduct amounted to non-payment of duty on such goods thereby attracting Section 11A for recovery and Section 11AC for penalty. The intent to evade payment of duty in the prescribed manner is common to both the above ingredients viz. wilful mis-statement of facts and contravention of a rule - Rule 15(2) clearly provides that, in such situations, the manufacturer shall also be liable to pay penalty in terms of provisions of Section 11AC of the Act - the assesse had failed to substantiate their case against the penalty imposed on them under Rule 15(2) read with Section 11AC – Appeal Dismissed. - Appeal No.E/2443/2010 - - - Dated:- 22-11-2012 - Mr. P.G. Chacko, J. For the Appellant: Mr. M.A. Narayan, Advocate For the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules, 2004. 5. The above decision of the original authority was rendered in adjudication of show-cause notice dt. 21/7/2009 wherein, for the purpose of invoking the penal provisions against the assessee, it had been alleged that they had mis-represented certain fact in the monthly returns. To be precise, the fact which was allegedly mis-represented by the assessee was that payment of duty by debit in CENVAT credit account was indicated in the returns as payment of duty from the account current. 6. On an appeal filed by the assessee, the Commissioner(Appeals) affirmed the Order-in-Original. Hence the present appeal of the assessee. 7. On a perusal of the records and hearing both sides, I find that the following facts are not in dispute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AC of the Act and the other under Rule 15(2) of the CENVAT Credit Rules, 2004. The learned counsel for the appellant has reiterated the grounds of the appeal vis-vis the demand of the CENVAT credit amount of Rs.1,69,765/-. The learned Superintendent(AR) has contested this challenge on the strength of the relevant findings of the original and first appellate authorities. 9. I have considered the submissions. It has already been noted to the effect that CENVAT credit of Rs.1,69,765/- was utilized by the assessee in contravention of Rule 8(3A) of the Central Excise Rules, 2002. Under the said provision of law, a manufacturer who has defaulted payment of duty in breach of Rule 8(1) and (3) is liable to pay duty on subsequent clearances consig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the show-cause notice and, therefore, the assessee cannot be treated as a defaulter and consequently there is no room for applying Section 11A. Where this provision is not applicable, Section 11AC of the Act is not invocable. These arguments have also been contested before me. After considering the submissions, I am not inclined to accept the above arguments of the learned counsel. It has already been noted that the assessee committed default in payment of duty for the period from November 2008 to May 2009. They created a situation of non-payment of duty for the said period for the Department to invoke Section 11A of the Act. If that be so, the applicability of Section 11AC of the Act cannot be resisted on the ground stated by the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit of Rs.1,69,765/- was utilized by the assessee in breach of Rule 8(3A) of the Central Excise Rules, 2004. Rule 15(2) of the CENVAT Credit Rules 2004 reads thus:- 15(2) In a case, where the CENVAT credit in respect of input or capital goods or input services has been taken or utilized wrongly by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of the Excise Act, or of the rules made thereunder with intent to evade payment of duty, then, the manufacturer shall also be liable to pay penalty in terms of the provisions of Section 11AC of the Excise Act. One of the ingredients for a penalty under the above provision is wilful mis-statement of facts with intent to e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invoked for imposing penalty. Per contra, the learned Superintendent(AR) has relied on two High Court decisions viz. Precision Fasteners Ltd. vs. CCE [2011(268) ELT 163 (Guj.)] and Vidushi Wires Pvt. Ltd. vs. UOI [2003(156) ELT 168 (Bom.)]. He has also claimed support from the Tribunals decision in Godrej Hershey Ltd. vs. CCE, Bhopal [2011(263) ELT 663 (Tri. Del.)]. 13. In the case of Solar Chemferts Pvt. Ltd. (supra), this Tribunal, following a decision of the Gujarat High Court 2010 (260) ELT 71 (Guj.), held that Rule 27 only could be imposed on an assessee on the ground of contravention of Rule 8(3A) of the Central Excise Rules, 2002. In the case of Vidushi Wires Pvt. Ltd. (supra), the Bombay High Court held that compliance with Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X
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