TMI Blog2014 (6) TMI 487X X X X Extracts X X X X X X X X Extracts X X X X ..... June, 2008, even in respect of clearance effected prior to 1.4.2008. Held that:- in terms of provisions of Rule 8 of Central Excise Rules, 2002, the duty liability in respect of goods cleared in March, 2008 is to be discharged in the month of March, 2008 itself. If the assessee defaulted in payment of duty beyond 30 days from the due date, he is debarred from utilizing the Cenvat credit. As per the appellants himself, the duty liability arose in the month of march, 2008 and the same was discharged beyond the period of 30 days in June, 2008. As such, consequence of violation of Rule 8(3A) of the Central Excise Rules, 2002 would flow resulting in denial of utilization of Cenvat credit along with interest and the penal provisions inasmuch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on the value or quantity of clearance in a financial year and which has been taking Cenvat credit on inputs or input service before such option is exercised, is required to be pay the amount equivalent to Cenvat credit, if any, allowed to him in respect of inputs lying in stock or in process or contained in their final product lying in the stock on the date when such option is exercised and after deducting such amount from the balance, if any, lying in his credit the balance, if any, still remaining shall lapse and shall not be allowed to be utilized for payment of duty on any excisable goods whether cleared for home consumption or for export. As such, with the exercise of option to avail the exemption, in terms of notification No. 4/08 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the paper division by way of issuance of show cause notice dated 15.6.09 alleging suppression and malafide intention and proposing recovery of duty of Rs.4,98,260/-. Further, inasmuch as the steel division has taken the credit of the duty paid by the paper division, the notice also proposed denial of credit to the steel division along with imposition of penalty on both the appellants. The said show cause notice culminated into an order passed by the original adjudicating authority confirming demand of duty of Rs,4,98,260/- along with interest and imposition of penalty of identical amount. Further, the credit of said amount availed by the steel division was denied to them and the same was confirmed along with confirmation of inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion was cleared in March, 2008, inasmuch as the appellants have used fresh new series invoices without the permission of department. As such, the underlying allegation is that invoices were raised in June itself which were back dated for March, 2008, with a malafide intention to transfer unutilized and lapsed credit to their sister concern which would take the credit of the same. 8. The appellants were admittedly clearing their goods on regular invoice book. They have not explained as to why a need for issuing of invoices from a new series arose for clearance of waste and scrap in question. There is no answer to the said question by the appellants, who have simplicitor pleaded lack of knowledge. The appellants are in existence for the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the duty in the month of March itself, admittedly they were entitled to use the credit. Having not used the same in the month of March, 2008, the appellants have missed the bus and cannot subsequently utilize the same after a gap of around three months. Such an action on the part of the paper division seems to be with sole purpose of transferring the unutilized and lapsed credit to their steel division, who was in a position to use the same, after taking the credit. 10. I also agree with the observation of the authorities below that in terms of provisions of Rule 8 of Central Excise Rules, 2002, the duty liability in respect of goods cleared in March, 2008 is to be discharged in the month of March, 2008 itself. If the assessee defaulted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the credit was utilized with a malafide intention to pass on the lapsed credit to their sister concern. As such, by extending benefit of doubt, I set aside the penalty on the paper division. 12. As regards the availability of credit to the steel division, I find that inasmuch as the payment of duty by the paper division from a lapsed credit has been held to be barred, the steel division is not entitled to use credit of the same. Even if the paper division deposits the duty in cash, the availment of credit to the steel division would be considered by the lower authorities, if the steel division make a claim of the same. Otherwise, the credit availed by the steel division is required to be reversed by them. As regards the penalty on st ..... X X X X Extracts X X X X X X X X Extracts X X X X
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