Penalty for issuing duty-free invoices upheld where conduct contravened the Cenvat Credit Rules and Rule 13 applied.

Issuing invoices without payment of duty and without clearance of goods was treated as a contravention of the Cenvat Credit Rules, 2002. The Tribunal noted that Rule 13 authorised penalty for such contravention in respect of inputs, up to the duty amount. On the admitted facts, the appellants had issued invoices without paying duty, and the relied-on case law was found not to address Rule 13. Penalty under the impugned order was therefore upheld and no interference was called for.

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Issues: Whether the appellants were liable to penalty for issuing invoices without payment of duty and without clearance of goods under the Cenvat Credit and Central Excise penalty provisions.

Analysis: The Tribunal noted that Rule 13 of the Cenvat Credit Rules, 2002 covered contravention of the Cenvat Credit Rules in respect of inputs and authorised penalty up to the duty amount where such contravention was committed. On the admitted facts, the appellants had issued invoices without payment of duty, which amounted to contravention of the Cenvat Credit Rules. The case law relied upon by the appellants was found not to deal with Rule 13 of the Cenvat Credit Rules, 2002.

Conclusion: The appellants were liable to penalty under the impugned order and no interference was called for.

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