Customs, Excise and Gold Tribunal - Delhi
U.P. State Sugar Corporation Ltd. vs Cce Meerut on 18 January, 2001
ORDER
V.K. Agrawal :
1. The issue involved in this appeal, filed by M/s U.P.State Sugar Corporation Ltd, is whether any penalty is imposable on them under Rule 173Q of the Central Excise Rules, when entire Modvat Credit has been allowed to them by the Commissioner (Appeals).
2. Shri Bipin Garg, Ld Advocate, submitted that Dy. Commissioner has disallowed capital goods credit amounting to Rs. 2,32,236.89P in repsect of certain capital goods and imposed a penalty of Rs. 50,000/- on them; that on appeal preferred by them the Commissioner (Appeal), under the impugned Order, allowed the capital goods credit entirely but reduced the penalty from Rs. 50,000 to Rs. 20,000/- only ; that as no capital goods credit has been availed of by them wrongly, no penalty need by imposed on them.
3. Shri A.K.Jain, Ld. DR, reiterates the findings of the Commissioner (Appeal) as contained in the impugned Order according to which there were certain irregularities/lapses and non observance of procedures.
4. I have considered the submissions of both the sides. Once the Commissioner (Appeal) has allowed entirely capital goods credit to the Appellants on all counts, the question of imposing any penalty on the Appellants does not arise. Penalty under Rule 173Q (bb) can be imposed for taking credit wrongly or without taking reasonable steps ensure that appropriate duty has been paid on the capital goods or for taking credit which assessee knows the same is not permissible under the rule or does not utilise the capital goods in the manner provided for or does not render proper account of the receipt and disposal of the capital goods or contravene any of the provisions contained in Chapter V of the Rules. As the credit has not been taken wrongly by the appellants, the penalty is not imposable on the Appellants. Accordingly the penalty imposed on appellant is set aside and the appeal is allowed.