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Shree Cement Ltd. Versus C.C.E. Jaipur

2016 (12) TMI 582 - CESTAT NEW DELHI

Chargeability of the interest on wrong availment of Cenvat Credit amounting to ₹ 35,14,493/- Held that: - there is direct ruling on this issue by the Hon’ble Supreme Court in the case of Union of India vs. Ind-Swift Laboratories Ltd.[2011 (2) TMI 6 - Supreme Court], where it has been held that where Cenvat Credit is taken OR utilized wrongly, the same along with the interest is to be recovered from manufacturer or the provider of the output service. The Hon’ble Supreme Court in the said ca .....

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respondent ORDER Per Ashok K. Arya 1. These two appeals have been filed by M/s Shree Cement Ltd. against the Common order-in-original dated 15.12.2009 passed by Commissioner Central Excise Jaipur-II. The matter mainly relates to the chargeability of the interest on wrong availment of Cenvat Credit amounting to ₹ 35,14,493/-. 2. The appellant has been represented by ld. Advocate, Ms. Rinky Arora and the department has been represented by the ld. AR, Sh. Yogesh Agarwal. 3. Based on the appea .....

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Yougesh Agarwal reiterates the findings given in the impugned order. He further inter alia submits that interest liability arises where the credit has been taken wrongly by the assessee. He cites the following case laws in support: i. Union of India vs. Ind-Swift Laboratories Ltd.- 2011 (265) E.L.T. 3 (S.C.):- ii. Commissioner of C. Ex. & Cus., Raipur Vs Vandana Vidyut Ltd.-2016 (331) E.L.T. 231 (Chhattisgarh). iii. Commissioner of Central Excise, Pune-I Vs GL & V India Pvt. Ltd.-2015(3 .....

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t account of the appellant?. The appellant has cited the decision of Hon ble Karnataka High Court in case of Bill Forge Pvt. Ltd. (supra). However we find that there is direct ruling on this issue by the Hon ble Supreme Court in the case of Union of India vs. Ind-Swift Laboratories Ltd.- 2011 (265) E.L.T. 3 (S.C.), where it has been held that where Cenvat Credit is taken OR utilized wrongly, the same along with the interest is to be recovered from manufacturer or the provider of the output servi .....

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CENVAT credit has been taken and utilized wrongly, interest should be payable from the date the CENVAT credit has been utilized wrongly for according to the High Court interest cannot be claimed simply for the reason that the CENVAT credit has been wrongly taken as such availment by itself does not create any liability of payment of excise duty. Therefore, High Court on a conjoint reading of Section 11AB of the Act and Rules 3 & 4 of the Credit Rules proceeded to hold that interest cannot b .....

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