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M/s. Man Structural Pvt. Ltd. Versus C.C.E. & S.T. Jaipur-I

2015 (11) TMI 664 - CESTAT NEW DELHI

Imposition of penalty - reversal of cenvat credit towards exempted goods after audit objection but before issuance of Show Cause Notice (SCN) - whether in the facts and circumstances of the case penalty is imposable on the appellant or not - Held that:- Admittedly, appellant is not maintaining separate account for input / input services which were being used for manufacturing of dutiable as well as exempted final product. It is also clear from the facts on record that at the time of availment of .....

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438 - PUNJAB & HARYANA HIGH COURT) wherein Hon ble High court has held that the case is related to reversal of amount under section 6(3)(b) of Cenvat Credit Rules 2004 penalty under section 11 AC is not imposable as the said provision are not applicable. Consequently, penalty under Rule 15 of the Cenvat Credit Rules 2004 is also not imposable. - Decided in favour of assessee. - Appeal No. E/55975/2013-EX(SM) - FINAL ORDER NO. 51668/2015-EX(SM) - Dated:- 6-5-2015 - Shri Ashok Jindal, Member (Jud .....

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No. 6/2006-CE dated 01.03.2006 during the period Oct 2008 to March 2009. The appellant is also availing Cenvat Credit on input / input services and is not maintaining separate account for inputs for manufacturing dutiable as well as exempted final product and also not paying amount equal to 10% of the value of the exempted goods at the time of clearance. An audit took place at the premises of the appellant. Audit pointed out the discrepancies and immediately on pointing out by the audit the app .....

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appellant. The Ld. Counsel for the appellant submits that the appellants are filing their ER-1 returns showing their clearance of exempted goods and they have intimidated to the department that for clearance of parts of wind mill they are availing exemption under notification no.6/2006-CE and clearing the goods without payment of duty. Therefore, extended period of limitation is not invokable. Moreover, it is submitted that as per Cenvat Credit Rules 2004 Rule 6(3) says that if appellant is not .....

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erna SSKK Ltd. Vs. CCE Aurangabad-2007 (209) ELT 194 (Tri-Bom). For limitation he relied on the decision in the case of Subhash Khandelwal & Sons Vs. CCE Jaipur-2011 (24) STR 461 (Tri-Del). 3. On the other hand Ld. AR drew my attention to the para 5 of show cause notice wherein it has been alleged that appellant has placed the fact of availment of Cenvat Credit which was used in manufacturing of both dutiable as well as exempted final product. Merely writing letter that they are claiming exe .....

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the value of exempted goods at the time of clearance. These facts have been suppressed by the appellant. Therefore, penalty is rightly imposed. To support his contention she relied on the decision in the case of CCE Vs. Gujarat Narmada Fertilizers Co. Ltd.-2009 (240) ELT 661 (SC). 4. Heard the parties. Considered the submission. 5. In this case short issue before me is that whether in the facts and circumstances of the case penalty is imposable on the appellant or not. Admittedly, appellant is n .....

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envat Credit whether these inputs will go in manufacturing of exempted goods. Further, on the legal aspect I find that the issue came up before the Honble High Court of P&H in the case of Sangrur Agro Ltd. (Supra) wherein Honble High court has held that the case is related to reversal of amount under section 6(3)(b) of Cenvat Credit Rules 2004 penalty under section 11 AC is not imposable as the said provision are not applicable. Consequently, penalty under Rule 15 of the Cenvat Credit Rule .....

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e of dutiable and exempted finished products had not maintained. Though the appellant plead that they have not taken Cenvat Credit in respect of inputs going into the manufacture of exempted finished products, I find that documents in this regard had been not produced before the Commissioner (A) and as such, they have not even disputed their liability to pay an amount equal to 8% of the value of the exempted finished products at the time of their clearances. It is only imposition of penalty unde .....

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t due under Rule 6(3)(b) of the Cenvat Credit Rules. The Tribunal in the case of CCE Vs. Sangrur Agro Ltd. (Supra) has held that the provisions of Section 11 AC are not applicable in respect of short payment or non-payment of the amount due under Rule 6(3)(b0 of the Cenvat Credit Rules. As per Explanation-1 to Rule 6(3), amount mentioned in clause (a) & (b) of sub-rule 3 of Rule 6 shall be paid by the manufacture by debiting the Cenvat Credit or otherwise and as per Explanation-II if a manuf .....

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