2008 (1) TMI 796 - AT - Central Excise

Tribunal dismisses Revenue's penalty appeals for contravention of Central Excise Rules

The Tribunal rejected Revenue's appeals against the setting aside of penalties under the Central Excise Rules for contravention of the Cenvat Credit ... Penalty on dealer - Cenvat/Modvat Issues:Revenue's appeals against setting aside of penalty under Central Excise Rules for contravention of Cenvat Credit Rules.Analysis:The case involved 12 Revenue's appeals arising from different Orders-in-Appeal where the Commissioner (Appeals) had set aside penalties imposed by the Assistant Commissioner under various rules. The brief facts of the case revolved around the appellants being registered dealers under Central Excise law receiving duty paid goods from a manufacturer. The department contended that passing on Cenvat credit to another dealer was in violation of certain rules. However, the Commissioner (Appeals) found no contravention requiring penalties to be imposed. This decision was supported by a previous judgment by the Tribunal in a similar issue where penalties were set aside for other dealers.The learned SDR argued that penalties were leviable for contraventions committed by the dealers and urged to confirm the Orders-in-Original. On the other hand, the learned Counsel cited a previous Tribunal order in favor of the appellants and Board's Circulars to support the position that penalties were not warranted. The Tribunal noted that the Commissioner (Appeals) correctly found no violation of the law as the goods were received under a valid invoice from the manufacturer, which was sufficient for issuing a First Stage Dealer invoice. The Tribunal also highlighted that there was no legal requirement for the customer in the transaction to be registered, supported by a relevant Board's Circular.After considering the submissions from both sides, the Tribunal concluded that the Revenue's appeals lacked merit as the dealers had received goods on proper invoices without any violation. Therefore, the appeals were rejected. Additionally, the learned Counsel requested an out-of-turn order issuance due to the Revenue's intention to recover the amounts, which was duly directed by the Tribunal.