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Reversal made with interest whether penalty @ 15% is to be paid.

Service Tax - Started By: - samiuddin ansari - Dated:- 4-8-2017 Last Replied Date:- 8-9-2017 - Sir,My friend is having one manufacturing unit. Audit team of the Central Excise department conducted audit and raised some observations related to cenvat credit availment on Inputs and utilisation thereof. On being agreed, he has made reversal of Cenvat credit availed and utilised of Inputs with interest. However, the Audit team emphasised to made reversal with interest and penalty. I would like to kn .....

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STURI SETHI - The Reply = Had you reversed wrongly availed credit along with interest on your own i.e. before being pointed out by the audit, you would have saved penalty. Thus you could prove your bona fide mistake. Now the die is cast. Audit would take the credit. Penalty is imposable as it is now record based mistake. Audit cannot brush aside penalty as they are answerable to the department. - Reply By samiuddin ansari - The Reply = I am not satisfied with response. Please quote under which p .....

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sise that had you reversed on your own you would have proved your bona fide. When you reverse on being pointed out by the department, it is minus point for you. Law is very much clear. Can you prove your bona fide, if so, you can save your self from penalty - Reply By KASTURI SETHI - The Reply = Dear Querist,SECTION [11A. Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. - (1) Where any duty of excise has not been levied or paid or has bee .....

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rt-paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice;(b) the person chargeable with duty may, before service of notice under clause (a), pay on the basis of,-(i) his own ascertainment of such duty; or(ii) the duty ascertained by the Central Excise Officer,the amount of duty along with interest payable thereon under section 11AA.(2) The person who has paid the duty under clause (b) of sub-section (1), sh .....

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in, Please make an application to the Department in the following format given in Annexure-X of CESTAM, 2015 (Audit manual). If it is considered positively, there would be waiver of SCN and the audit objection would be closed accordingly: ANNEXURE - CE- X DRAFT OF THE LETTER TO BE WRITTEN BY THE ASSESSEE UNDER SECTION 11A (2) OF THE CENTRAL EXCISE ACT, 1944, To, The Commissioner Customs, Central Excise and Service Tax, Audit Commissionerate ______________________________ Sir, Subject: Letter giv .....

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