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of <h1>Appeal Partially Allowed with Token Penalty: CENVAT Credit and Cess Payments Legally Upheld</h1> The appeal was allowed partly with a token penalty imposed. Duty demand was confirmed, but the Appellant was granted exoneration from a higher penalty ... - Issues involved:1. Whether there was a shortage of input and duty amount leviableRs.2. Whether CENVAT Credit was allowable without Basic Excise Duty paidRs.3. Whether the cess amount paid was leviable or notRs.Issue 1:The Appellant argued that the alleged discrepancy in input was compensated as the goods were used in manufacturing after being accounted for. They requested leniency due to their cooperation in depositing duty and penalty. The Appellate Order acknowledged the shortage but granted exoneration from penalty while confirming duty demand.Issue 2:The Appellant, being new to the input, claimed ignorance regarding CENVAT Credit eligibility for CVD paid. The learned Consultant admitted the cess was payable and paid by the Appellant.Issue 3:The Revenue contended that the shortage of goods was admitted by the Appellant and the search process was not flawed. They supported the legality of CENVAT Credit and cess payment. The Appellate Order upheld the duty demand but reduced the penalty significantly, considering the Appellant's cooperation and lack of malicious intent.In conclusion, the appeal was allowed partly, with a token penalty imposed. The duty demand was confirmed, while the Appellant was granted exoneration from a higher penalty amount. The CENVAT Credit and cess payments were deemed legally payable.
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