2018 (8) TMI 1381 - AT - Central Excise

Tribunal denies rectification application for penalty imposition error under CENVAT Credit Rules

The Tribunal dismissed the application seeking rectification of a mistake in the order regarding the imposition of penalties under Rules 15(1) and 15(2) ... Rectification of order - apparent mistake on the face of the record - simultaneous penalty under Rules 15(1) and 15(2) of the CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 - fraudulent availment of CENVAT credit - review jurisdiction of appellate tribunal - precedent of Commissioner of Central Excise, Belapur v. RDC Concrete (India) Pvt. Ltd.Rectification of order - apparent mistake on the face of the record - simultaneous penalty under Rules 15(1) and 15(2) of the CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 - review jurisdiction of appellate tribunal - fraudulent availment of CENVAT credit - precedent of Commissioner of Central Excise, Belapur v. RDC Concrete (India) Pvt. Ltd. - Application for rectification to recall the Tribunal's order so as to record and reconsider submissions on simultaneous imposition of penalties under Rules 15(1) and 15(2) read with Section 11AC was not maintainable. - HELD THAT: - The applicant sought rectification of the Tribunal's order dated 21.9.2017 on the ground that the Tribunal had not recorded its submissions that simultaneous penalties under Rules 15(1) and 15(2) read with Section 11AC could not be imposed. The Tribunal examined the record and found that it had analysed the evidence and reached the conclusion that the appellant had fraudulently availed CENVAT credit without receipt of inputs and had dismissed the appeal on that basis. Reopening the order at this stage to reconsider the quantum or imposition of penalties would amount to a review of the earlier decision. Such review jurisdiction is not available to the Tribunal in the guise of rectification, having regard to the legal principle laid down by the Supreme Court in RDC Concrete's case. Consequently, the application for rectification, being an impermissible attempt to review the order, was dismissed. [Paras 5, 6]Application for rectification dismissed as impermissible review of the Tribunal's earlier decision.Final Conclusion: The rectification application was dismissed; the Tribunal upheld its earlier conclusion of fraudulent availment of CENVAT credit and declined to reopen or review the penalty findings in light of the authoritative precedent disallowing such review. Issues: Rectification of mistake in the order regarding imposition of penalty under Rules 15(1) and 15(2) of the CENVAT Credit Rules, 2004.Analysis:1. The issue in this case pertains to an application seeking rectification of a mistake claimed to be apparent on the face of the order dated 21.9.2017, specifically regarding the imposition of penalty under Rules 15(1) and 15(2) of the CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944.2. The appellant, through their Advocate, contended that their appeal was dismissed without recording their submissions that simultaneous penalty under the mentioned rules cannot be imposed. They argued for a recall and rehearing of the case due to the absence of a finding on this issue in the original order.3. On the other hand, the Revenue's representative argued that the appellant did not dispute the imposition of penalty under both Rules 15(1) and 15(2) in their grounds of appeal. They cited the Supreme Court's judgment in Commissioner of Central Excise, Belapur Vs. RDC Concrete (India) Pvt. Ltd. to assert that reviewing the order at this stage would not be permissible.4. After hearing both parties and examining the records, the Tribunal found that the appellant had fraudulently availed CENVAT Credit without receiving the inputs, leading to the dismissal of their appeal. The Tribunal concluded that reconsidering the penalty at this stage would amount to a review of the order, which is against the legal principles established by the Supreme Court in the RDC Concrete case.5. Consequently, the Tribunal ruled that the application seeking rectification of the order lacked merit and was therefore dismissed. The decision was based on the principle that revisiting the penalty issue would essentially be a review of the original order, which is not within the Tribunal's authority as per legal precedents.This detailed analysis encapsulates the key arguments and the Tribunal's reasoning behind the decision to dismiss the rectification application concerning the imposition of penalties under the CENVAT Credit Rules.