TaxTMI 
TaxTMI 
2018 (4) TMI 59
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.... formula given in the Rule 3(6) (a) of the erstwhile Cenvat credit Rules, 2002 and Rule 3 (7) (a) of Cenvat Credit Rules, 2004. Thus, the appellant were found to have availed excess amount of credit of Rs. 51,32,892/- during 2003-04 and Rs. 5,00,761/- during 2004-05. A show cause notice was therefore issued proposing recovery of Cenvat credit taken by the appellant along with interest and also proposing a penalty under Rule 13(2) and Rule 15(2) of the Cenvat credit Rules, 2002 and 2004 respectively read with Section 11 AC of the Central Excise Act, 1944. The matter was adjudicated and the demand of Rs. 56,33,653/- was confirmed along with interest by the adjudicating authority. The penalty of Rs. 56,33,653/- was also imposed on the appellant under Rule 13(2) and Rule 15(2) of the Cenvat credit Rules, 2002 and 2004. Aggrieved from the order of the adjudicating authority, the appellant have filed this appeal. 3. Ld. Advocate for the appellant submits that they are not contesting the demand of duty and interest and are only contesting the penalty imposed on the appellant. He further contended that it was a case of wrong computation of Cenvat credit, which was not in accordance with f....
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....s taken irregularly is determined to the extent of Rs. 25,66,446/- during 2003-04 and Rs. 30,67,207/- during 2004-05. The question therefore is whether the appellant had intention to evade duty. The appellant have contended that the credit was not taken on ineligible goods and it is not a case of non payment of duty. Hence, there is no suppression of facts with intent to evade duty. This contention of the appellant does not carry much force because the requirement of law under Rule 13(2) and Rule 15(2) of CCR is that if the credit is taken/utilised in respect of the goods for the reason fraud, collusion, wilful misstatement or suppression of facts etc. which means if these elements are present and even if the irregular credit is taken on eligible goods, the penalty can be imposed. Hence, the key question is whether any of these elements is present. The appellant have argued that reversal of excess credit was not done at the instance of the department. They have referred to the Department's letter dated 18.2.2005 claiming that there is no reference to recovery of the excess credit in the said letter. We have seen the letter dated 18.2.2005. It is clear from the said letter that ....
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.... to determine what should be the extent of credit, the proper course would have been to check up with the department or to inform the department as to what credit was being taken by them." 9. Further, the appellant have argued that in respect of amount deposited by them on 31.3.2005, the duty was to be determined within one year of date of payment. They have not cited any provisions of law to support this contention. However, they have relied on case law of Florida Electricals Ltd. (supra) in support of their contention. We find that the said case is not applicable as the facts are different because in that case the amount of Rs. 15 lakh was deposited during investigation when the Central Excise officers visited the premises of the Florida Electricals Ltd. While show cause notice was issued and hearing had been held, the Tribunal directed the refund of the deposit made during the investigation on the ground that in the absence of any duty liability. In the present case, the appellant have deposited the duty and have admitted that excess credit was taken by them and this was not a case where the amount was deposited at the start of the investigation. As the show cause notice can be....
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....he appellant amounting to Rs. 991.66 lakhs and at that stage only the department came to know that the work order was to carry out the job for furniture also. A bare perusal of the records shows that the aforesaid reply was sent by the respondent on receipt of a letter issued by the Commissioner of Central Excise on 27-2-1997. If the period of limitation of five years is computed from the aforesaid date, the show cause notice having been issued on 15-5-2000, the demand made was clearly within the period of limitation as prescribed, which is five years." Applying the above judgment to the present case, the reply of the appellant dt.21.2.2005 was sent on receipt of letter dt.18.2.2005 and show cause notice having been issued on 29.5.2008 was clearly within the period of limitation. 12. The appellant have also relied upon the decision of the Hon'ble Supreme Court in the case of Uniworth Textiles Limited (supra), we find that in that case since the appellant laboured under the very doubt which formed the basis before the Hon'ble Supreme Court and had addressed it to the concerned authority, in circumstances of the case, Hon'ble court concluded that conduct of the appellan....