Custom, Excise & Service Tax Tribunal
M/S. Jaypee Rewa Plant vs Cce, Bhopal on 12 February, 2008
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST BLOCK NO. 2, R.K. PURAM, NEW DELHI PRINCIPAL BENCH, NEW DELHI EXCISE APPEAL NO. 3882 OF 2005-SM [Arising out of Order-in-Appeal No. 75-CE/BPL/2005 dated 26.09.2005 passed by the Commissioner (Appeals), Customs & Central Excise, Bhopal] For approval and signature: Honble Mr. S.S. Kang, Vice President 1. Whether Press Reporters may be allowed to see the order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair copy of the order? 4. Whether order is to be circulated to the Departmental authorities? M/s. Jaypee Rewa Plant Appellants Vs. CCE, Bhopal Respondent
Appearance:
Shri Ravi Raghavan, Advocate for the appellants, Ms. Archana P. Tiwari, Jt. CDR for the respondent Coram:
Honble Mr. S.S. Kang, Vice President Date of Hearing: 12th February, 2008 FINAL ORDER NO._________________ dated __________ Per S.S. Kang:
Heard both sides.
2. The appellants filed this appeal against the demand of interest and penalty of Rs. 10,000/-. Brief facts of the case are that the appellants are working under CENVAT Credit Scheme. They availed credit which was reversed suo moto when they noticed that it was wrongly taken. A show cause notice was issued for demand of interest on the ground that Modvat credit wrongly taken and also for imposition of penalty. The adjudicating authority confirmed the demand of interest and imposed the penalty of Rs. 10,000/-. Appeal filed against the adjudication order was dismissed by the Commissioner (Appeals).
3. Contention of the appellants is that there is no dispute regarding the fact that wrongly availed credit was not utilized. This fact was noticed in the adjudication order. Contention is that the Honble Punjab & Haryana High Court in the case of CCE vs. Maruti Udyog Ltd., reported in 2007 (214) ELT 173 has upheld the view taken by the Tribunal that in case credit was not utilized, assessee is not liable to pay interest.
4. In respect of penalty contention of the appellants is that as they reversed the credit suo moto as the same was wrongly taken, there was no intention to wrongly availed credit. Hence, they are not liable for penalty.
5. Contention of the Revenue is that, as per Cenvat Credit Rules manufacturers is liable to pay interest in respect of credit taken or utilized wrongly. Therefore, the appellant is liable for interest and penalty.
6. I find that the issue in respect interest on of credit taken wrongly but not utilized is stand settled by the Honble Punjab & Haryana High Court in the case of Maruti Udyog Ltd. (supra) and the appeal filed by the Revenue has been dismissed by the Honble Supreme Court. Undisputed fact is that credit wrongly taken was not utilized, therefore, demand of interest is not sustainable.
7. In respect of imposition of penalty, I find that credit taken by the appellants was reversed by them suo moto in the same or subsequent month. Therefore, there is no intention to evade payment of duty, hence, imposition of penalty is not sustainable. Accordingly, appeal is allowed.
(Dictated & pronounced in the Open Court.) (S.S. KANG) VICE PRESIDENT Dated 12th February, 2008 RK