TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Appellate Tribunal reverses penalties in SEPL cenvat credit case</h1> <h3>M/s. Sandeep Enterprises Pvt. Limited Versus Commissioner of Central Excise Vadodara</h3> M/s. Sandeep Enterprises Pvt. Limited Versus Commissioner of Central Excise Vadodara - TMI Issues:1. Wrong availment of cenvat credit by the assessee.2. Imposition of penalties on the appellant company and its Managing Director.3. Lack of specific allegation of deliberate wrong credit availment in the show cause notice.4. Consideration of limitation plea by the appellate authority.5. Allegation of suppression or mis-declaration and imposition of penalty.6. Conclusion on the imposition of penalties.Analysis:The judgment by the Appellate Tribunal CESTAT, Ahmedabad dealt with the case of M/s. Sandeep Enterprises Pvt. Limited (SEPL) regarding the wrongful availment of cenvat credit amounting to Rs. 31,700. The proceedings resulted in penalties being imposed on the appellant company and its Managing Director for the cenvat credit wrongly availed. The Managing Director contended that the error occurred due to lack of knowledge and clerical mistake, promptly rectified upon discovery. It was argued that the substantial cenvat credit availed during the period indicated no deliberate intent to avail the credit wrongly. The appellant chose not to contest on the grounds of limitation, opting to settle the matter by promptly paying the demanded cenvat credit. The issue primarily revolved around the imposition of penalties.The Tribunal noted that the show cause notice lacked a specific allegation of deliberate wrong credit availment, focusing on the wrongful availing of credit instead. The original adjudicating authority acknowledged the appellant's explanation of the error being unintentional due to clerical oversight. Despite the absence of deliberate intent, penalties were imposed on both SEPL and the Managing Director based on the proposed penalties in the show cause notice. The Tribunal observed that the imposition of penalties under Rule 15 of Cenvat Credit Rules and Rule 25 of Central Excise Rules was deemed appropriate.The appellate authority's consideration of the limitation plea was questioned, with the Commissioner stating that the appellants failed to raise the issue of limitation initially. The Commissioner upheld the penalties, emphasizing that the appellants did not contest the demand based on limitation. However, the Tribunal highlighted that in the absence of suppression or mis-declaration, the imposition of penalties was unwarranted once the duty and interest were paid as per Section 11A (2B) of the Central Excise Act, 1944. The Tribunal concluded that in the absence of specific allegations, no show cause notice should have been issued, leading to the decision to allow the appeals and stay petitions filed by the appellants.In summary, the judgment focused on the lack of deliberate intent in the wrongful availment of cenvat credit, the absence of specific allegations in the show cause notice, and the unwarranted imposition of penalties in the absence of suppression or mis-declaration. The Tribunal allowed the appeals, emphasizing the importance of considering all relevant factors before imposing penalties in such cases.
TaxTMI 
TaxTMI 
