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M/s Sree Rayalseema Green Steloy Ltd. Versus CCE, C&ST, Tirupati

CENVAT credit - Clearance of 'CENVAT credit availed Capital Goods' without payment of duty - Rule 3(5) of CENVAT Credit Rules, 2004 - Penalty u/s 11AC of CEA, 1944, read with Rule 15(2) of the CCR, 2004 - Held that: - There is no dispute that appellant had not discharged the duty liability at the time of clearance capital goods cleared from the factory and duty liability was discharged only on being pointed out - this act of appellants is gross violation of the provisions of the law with intent .....

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Excise, Anti-Evasion unit of Kurnool (hereinafter referred to as 'Officers' or 'Department') revealed that the appellant had cleared the 'CENVAT credit availed Capital Goods' from their premises without payment of amount payable in terms of the provisions of Rule 3(5) of CENVAT Credit Rules, 2004; 2.2 Investigation in to the matter revealed that the appellant had entered into a Lease Agreement dated 07.01.2010 (Annexure-A.1) with M/s. Sree Balajee TMT Rod Mills Private L .....

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ills Private Ltd., (SMS Division) was subsequently changed as M/s Aastha Alloycorp Pvt. Ltd., (SMS Division) and this change of name was incorporated in the central excise records on 05.06.2012; 2.3 The officers of the Anti-Evasion wing of Kurnool have visited the factory premises of M/s Aastha Alloycorp Pvt. Ltd., (SMS Division) on 28.11.2013 for physical verification of capital goods. At the time of their visit Sri D.V. Suresh Babu, Manager and Authorised Signatory of the M/s Aastha Alloycorp .....

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ar, Bangalore under Lease Agreement dated 30.05.2011 (effective from 15.01.2011). The appellant had retained certain part of land in Survey No.143 B/2 for themselves and got amended their ground plan accordingly in the Central Excise Registration Records and presently they are filing monthly Central Excise ER.1 Returns with the Range office depicting Nil transactions; 2.5 From the above and as admitted by the appellant vide statements/letters submitted, it appeared that they had removed the capi .....

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r manufacture of excisable goods by taking separate Central Excise Registration. The change of Ground Plans submitted by the appellant clearly demonstrates that the capital goods are lying/installed outside the registered premises (as per revised ground plan) and are in absolute control of lessee. However, in the case of capital goods cf SMS Division, they even gone to the extent of selling CENVAT taken capital goods to others clandestinely. Leasing out of capital goods and handing over the abso .....

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g whatever relief is possible in within the framework of law. i) I confirm demand of an amount of ₹ 18,31,267/- (Rupees eighteen lakhs thirty one thousand two hundred and sixty seven only) in respect of capital goods removed from the premises of SBTMT under Rule 3 (5A) of the CENVAT Credit Rules, 2004. I appropriate an amount of ₹ 13,42,844/- (Rupees thirteen lakhs forty two thousand eight hundred and forty four only) towards the above liability. ii) I demand interest under Section 1 .....

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oods leased to M/s SBTMT. Revenue has not filed any appeal against the impugned order. Appellant assessee is aggrieved by the impugned order for confirmation of demand of ₹ 18,31,267/- with interest and penalties. 4. Ld. Counsel submits that the impugned order is not correct in confirming the demand. It is his submission that appellants could not discharge the duty liability on the capital goods sold as the prices were not finalised. It is his submission that once prices were finalised the .....

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ant is only contesting the penalties impose by the adjudicating authority. The adjudicating authority has imposed a penalty of ₹ 18,31,367/- under Section 11AC of Central Excise Act, 1944, read with Rule 15(2) of the CENVAT Credit Rules, 2004, which is contested by appellant. 8 In my opinion, the adjudicating authority has given a detailed reasoning for confirmation of demand of ₹ 18,31,367/- with interest and also for imposing penalties. would like to reproduce the said findings. 32 .....

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7; 18,31,267/- where as the duty paid on transaction value is arrived at ₹ 13,42,844/-. Since the amount calculated as per the provisions of Rule 3(5A) are higher than the amount of duty paid on transaction value, the amount payable by the assessee is ₹ 18,31,267/-. 33. The assessee in their reply to the show cause notice submitted that they arrived at ₹ 31,42,844/- towards CENVAT credit liable to be paid as per provisions of Rule 3(5A) of CENVAT Credit Rules, 2004. The said am .....

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are removed during the month October, 2013 only. The assessee has removed the capital during the month of October, 2013 and paid the amount on 02.12.2013 and required to pay interest. 34. As regards the claim of the assessee that the notice is time barred, it can be seen that the departmental officers visited the factory on 23.11.2013 on specific intelligence that the assessee had removed capital goods without raising a proper document. On the visit of the departmental officers they agreed that .....

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