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2016 (11) TMI 921 - CESTAT MUMBAI

2016 (11) TMI 921 - CESTAT MUMBAI - TMI - Demand of interest and penalty - credit availed on inputs transferred to other unit - reversal of the said credit on being pointed out after a year and a half - Held that: - the Cenvat Credit Rules are very unambiguous and clear. There is not an iota of doubt about the manner in which the credit is required to be taken in such cases and the amount of credit are required to be taken when the same goods are received. The appellant’s contention that it was .....

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d is to be mentioned. It is not something which can slip out of mind inadvertently. In this era of self assessment great trust has been placed on the assessee to do self assessment diligently and properly. In the instant case, it is apparent that the other unit to which the material was transferred could not have benefited by taking the credit of the said duty. In these circumstances, the intention to evade duty is apparent. Section 11A (2B) not applicable to the cases where the duty was short p .....

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ansferred to their Baddi unit. The appellant availed the entire credit of the materials imported including the credit in respect of the material which was sent to Baddi unit. During audit in 2009 it was detected that the appellant had taken credit of the entire quantity while a part of the quantity was transferred to their Baddi unit. On pointing out, the appellant reversed the credit after about a year and a half. They have also paid interest thereon. A show-cause notice was issued in October 2 .....

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Counsel for the appellant argued that Section 11A (2B) of the Central Excise Act, reads as follows: Where any duty or excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person, chargeable with the duty, may pay the amount of duty71 [on the basis of his own ascertainment of such duty or on the basis of duty ascertained by a Central Excise Officer] before service of notice on him under sub-section (1) in respect of the duty, and inform the Centr .....

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counted from the date of receipt of such information of payment. Explanation 1. -Nothing contained in this sub-section shall apply in a case where the duty was not levied or was not paid or was short-levied or was short-paid or was erroneously refunded by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty. Explanation 2. -For the removal of doubt .....

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interest thereon. 3. According to learned Counsel for the appellant, since they had reversed the credit and also paid the interest when the same was pointed out by the Revenue they are covered by the said sub section (2B) of the Section 11A. She also argued that merely alleging suppression is not enough and the Revenue is required to prove the same. 4. The learned AR argues that the second unit which the material was transferred is located in Baddi and does not benefit from the credit of duty pa .....

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