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2016 (11) TMI 512 - CESTAT BANGALORE

2016 (11) TMI 512 - CESTAT BANGALORE - TMI - Interest and penalty for taking the Cenvat credit wrongly - whether mere wrong availment of CENVAT credit without utilisation of the same would attract interest and penalty? - Held that: - reliance placed on the decision of the case of Commissioner of Central Excise & ST, LTU, Bangalore vs. Bill Forge Pvt. Ltd. [2011 (4) TMI 969 - KARNATAKA HIGH COURT] where it was held that The liability to pay interest would arise only when the duty is not paid on t .....

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t Shri Ezhilmathi, AR, Mr. Mohammed Yousuf, AR For the Respondent ORDER Per S. S. Garg The appellant has filed two appeals against the common impugned order passed by the Commissioner (A) vide his order dated 22.11.2012 vide which the learned Commissioner (A) has rejected the appeals of the appellant. Since in both the appeals the issue is identical, hence both these appeals are disposed of by this common order. 2. Briefly the facts of the present case are that the appellant is engaged in the ma .....

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regular credit worked out to ₹ 7,10,012/- and further 100% CENVAT credit has been availed in respect of capital goods in the same financial year in which it was purchased. Excess credit in this regard amounted to ₹ 9,95,062/-. On being pointed out, the appellant voluntarily reversed such irregular credit availed on 25.3.2009. Thereafter the internal audit team issued an audit note wherein interest of ₹ 1,76,023/- in respect of the aforesaid reversal of CENVAT credit was demande .....

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der, the appellant filed appeal before the Commissioner of Central excise mainly on the ground that mere wrong availment of CENVAT credit without utilisation of the same does not attract interest and penalty and consequently penalty not leviable when wrongly availed credit has been voluntarily reversed. The learned Commissioner (A) vide his order dated 22.12.2012 rejected the appeal of the appellant. Aggrieved by the impugned order, the present appeal has been filed. 3. I have heard the learned .....

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yment of duty. As the appellant at the time of availment of irregular credit used CENVAT credit accumulated in their books of accounts to the tune of ₹ 12/- crores whereas CENVAT credit availed was only to the tune of ₹ 18,57,641/- during the relevant period. He further submitted that reversal of CENVAT credit wrongly availed and reversed before utilisation amounts to non-availment of CENVAT credit and hence interest and penalty not payable under Rule 15(1) of CCR, 2004. In support o .....

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86) E.L.T. 144 (Tribunal) approved in 2000 (119) E.L.T. A177 (S.C.) 5. On the other hand, the learned AR reiterated the findings in the impugned order and submitted that as per the judgment of the Hon ble Supreme Court in the case of UOI vs. Indswift Laboratories Ltd. reported in 2011 (265) E.L.T. 3 (S.C.) wherein it has been held that interest would be leviable from the date of wrong availment of credit. He further submitted that as per the provisions of Rule 14 of the CCR, the appellants are l .....

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