Fraudulent credit availment and forged challan use justified penalty under central excise rules, with relief refused.

Fraudulent availment of credit on the strength of a forged TR-6 challan, followed by use of that wrongful credit for duty payment on clearances, was treated as deliberate fraud and forgery. The appellate authority held that these facts attracted penalty under Rule 173Q of the Central Excise Rules, 1944 and found no basis to interfere with the penalty. Relief from penalty was refused and the appeal was dismissed, with the penalty sustained.

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Issues: Whether the appellant was entitled to relief from penalty for fraudulent availment of credit and consequent clearances without payment of duty.

Analysis: The record showed fraudulent taking of credit on the strength of a forged TR-6 challan and use of that wrongful credit for duty payment on clearances made between the relevant dates. The appellate authority treated the conduct as deliberate fraud and forgery, found no basis for interference with penalty, and considered penalty under Rule 173Q of the Central Excise Rules, 1944 to be attracted in the circumstances.

Conclusion: Relief from penalty was refused and the appeal was dismissed. Penalty of Rs. 50,000 was sustained under Rule 173Q of the Central Excise Rules, 1944.

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