Cce vs Machino Montell (I) Limited on 26 April, 2004
It can be seen that as regards the first item which is Rs.9,88,419/-, the submission that it was a revenue neutral situation is correct. As regards the other two amounts, such mistakes can happen because of arithmetical errors. Therefore I find that in this case imposition of penalty on the ground of suppression of fact may not be sustained. The learned AR would rely upon the decision in the case of CCE, Delhi-III Vs. Machino Montell (I) Ltd.[2006(202) ELT 398 (P&H)]. I fully agree that once suppression or misdeclaration is established, penalty is mandatory. In this case, the show-cause notice alleged suppression and it was stated that the fact of availment and utilization of CENVAT credit have not been intimated to the Department by the assessee in their monthly ER1 returns or in any manner whatsoever and the same amounts to wilfull suppression with an intention to evade payment of duty. There is no finding clearly that the amounts taken as credit in this case were not part of the total amount of CENVAT credit taken in the ER1 by the assessee in any of the records. Further there is no requirement under the law to intimate to the Department of each and every document on the basis of which credit has been taken. Moreover, there is no indication that the appellant was required to intimate wrong availment of credit. If they were to know that the credit has been wrongly availed and intimated the same, that could have clearly established an intention to evade payment of duty on their part since they would have intimated something which were not required to be intimated. The suppression cannot be alleged in this case since there is no requirement under the law to intimate details of documents on the basis of which credit has been taken. Under these circumstances, the penalty imposed on the appellant cannot be sustained. Accordingly, appeal is allowed with consequential relief if any to the appellant as for as penalty under Section11AC imposed on the appellant.