Tribunal Upholds Cenvat Credit Demand with Interest, Varies Penalties

The Tribunal upheld the demand for cenvat credit with interest but set aside penalties for certain credit amounts. The penalty for wrongful credit availed on a specific amount was upheld, while penalties for other amounts were either set aside or upheld based on the presence of suppression of facts.

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Issues:
1. Admissibility of credit on MS Channels, Angles, Beams, etc.
2. Denial of credit on supplies from a 100% EOU.
3. Admissibility of credit on basic customs duty and education cess.

Issue 1: The appellant availed credit on MS Channels, Angles, Beams, etc., based on invoices from a 100% EOU. The Tribunal's decision in Vandana Global Limited case was cited, arguing that the issue was settled against the appellant. The Commissioner contended that these items were not eligible for credit as they were used for building platforms, not as inputs or capital goods. The appellant argued that with conflicting decisions and the matter referred to a Larger Bench, penalty for suppression of facts was unwarranted. The Tribunal found that if an assessee believed in good faith they were entitled to credit, no penalty should apply.

Issue 2: Credit was denied on supplies from Reliance Industries Limited, a 100% EOU, due to discrepancies in invoices showing different duties. The appellant claimed it was a mistake, supported by past transactions with Reliance Industries and a substantial existing cenvat credit balance. The Tribunal noted the appellant's prompt payment of the disputed amount with interest upon notification by officers, indicating no intention to evade duty. As there was no suppression of facts, the Tribunal ruled in favor of the appellant, closing the issue.

Issue 3: An amount relating to basic customs duty and education cess was disputed. The Tribunal found that the appellant, an experienced Central Excise assessee, could not claim ignorance or mistake. The appellant had a history of availing cenvat credit and had taken credit only for CVD while paying basic customs duty. This selective credit availing amounted to suppression of facts, leading to the imposition of a penalty.

In conclusion, the Tribunal upheld the demand for cenvat credit with interest but set aside the penalty for certain credit amounts. The penalty for wrongful credit availed on a specific amount was upheld, while penalties for other amounts were either set aside or upheld based on the presence of suppression of facts.

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