TMI Blog2017 (11) TMI 763X X X X Extracts X X X X X X X X Extracts X X X X ..... the capital goods were installed in the premises of M/s SKPL through solid foundations. Accordingly, the demand with interest has been rightly issued and confirmed invoking larger period of limitation against M/s SKPYL. Confiscation of capital goods, on which credit availed at M/s SKYPLbut found in the premises of M/s SKPL - Held that: - confiscation do not sustain as removal of the duty paid capital goods without intimation to the department, cannot make the capital goods non-duty paid and offending one, inviting confiscation of the same. Penalty - Held that: - the penalty equal to the credit wrongly availed imposed on them is justified - the penalty imposed on M/s SKPL and Sh. Tayal, Director appears to be too harsh, and in the interest of Justice, it is reduced to ₹ 2.00 Lakhs and ₹ 1.00 lakh, respectively. Appeal allowed in part. - E/698-700/2010-SM - A/13314-13316/2017 - Dated:- 31-10-2017 - Dr. D. M. Misra, Member (Judicial) For the Appellant : Mr. Swapnendu Mishra (Advocate) For the Respondent : Mr. A. Mishra (A.R.) ORDER Per : Dr. D. M. Misra These three appeals are filed against order-in-appeal No.KRS/33-35/VAPI/2010 passe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inable in law. Further, he has submitted that demand notice issued on 02.07.1999 for the Modvat Credit availed during the period 1994 to 1995, hence it is barred by limitation inasmuch as all facts are disclosed to the department and, therefore, larger period of limitation cannot be invoked against the appellant. It is his further contention that confiscation of the capital goods on which duty has been duly discharged cannot be sustained; also confiscation of plant and machinery of the appellant M/s SKPL unsustainable in law. It is his contention that under a bonafide belief that transfer of capital goods from one unit to another unit belonging to the same group would not require any reversal of credit being a revenue neutral situation, therefore, demand as well as penalty on the appellants are unsustainable in law. 4. Ld. AR for the Revenue reiterated the findings of the Ld. Commissioner(Appeals). He has submitted that the total demand of ₹ 30,52,942/- confirmed against the appellant M/s SKPYL constituted three components; ₹ 27,50,691/- relates to the capital goods mentioned at Serial No. 1 to 34 of the Annexure C to the Show Cause Notice, which were either not inst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finished goods in that factory, when the said capital goods were found in the premises of M/s SKPL, then another registered unit. 5. Heard both the sides and perused the records. 6. I find that the short issues involved in the present case for determination are: whether Modvat Credit of ₹ 38,53,942/- on capital goods with interest and penalty is recoverable from the appellant M/s SKPYL and consequent confiscation of seized capital goods, plant and machineryas directed be confirmed and penalty on other appellants beupheld. 7. Undisputedly the appellant had availed Modvatcredit of ₹ 27,50,691/- on capital goods(sr. no.1 to 34 of Annex to SCN) ₹ 5,05,540/-(sr.no.35 to 37 of Annex to SCN) that were not found in the premises of the appellant M/s SKPYL on the date of visit of the officers. Explaining the reason for its non-availability, General Manager Excise, Sh. Gupta has admittedly informed the visiting officers that the same were removed from the factory and installed in the premises of M/s SKPL, without any intimation to the department. Even though, in the subsequent statement of the Director Shri. Tayal, it has been stated that those capital goods were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... three or four years. There is, thus, no evidence that the same were installed/ used by the appellants and were transferred to M/s SKPL after 3-4 years as submitted by the appellants and accordingly above submissions are rejected. The appellants have also argued on limitation. In this respect also the appellants have provided no evidence to show that the receipt of the said goods was known to the department and they had also verified the same. Even if it was so it cannot be said that its removal, with or without use, was also known to the department. The appellants themselves are stating that the same were cleared in 1997-1998, for which they have provided no evidence, then how the department could know from the returns submitted that the said capital goods have been removed by the without payment of duty. The appellants submissions are thus vague and without any evidence. The appellants main submissions have been on revenue neutrality. They have submitted that duty if any paid would have been available to M/s SKPL and a such entire exercise was revenue neutral. In this respect I find that both the companies are separate legal entities and are subject to different taxes separately a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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