Tribunal sets aside penalty for contravention of Central Excise Rules, upholds penalty for availing CENVAT Credit twice.

The Tribunal set aside the penalty imposed under Rule 25(1)(a) of Central Excise Rules for contravention of Rule 8(3A) of Central Excise Rules. However, the penalty of &8377;2,000 for availing CENVAT Credit twice on the same invoice under Rule 15(1)(a) of CENVAT Credit Rules was upheld. The decision was rendered on 25.01.2019.

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Issues involved:
Violation of Rule 8(3A) of Central Excise Rules, 2002 and imposition of penalty, availing CENVAT Credit twice on the same invoice and penalty imposed under Rule 15(1)(a) of CENVAT Credit Rules, 2004.

Analysis:

Issue 1: Violation of Rule 8(3A) of Central Excise Rules, 2002 and imposition of penalty
The appellant defaulted in paying central excise duty within 30 days from the due date, leading to a penalty under Rule 8(3A) of Central Excise Rules, 2002. The Superintendent issued a show cause notice, contested by the appellant on jurisdictional grounds. The Asst. Commissioner imposed a penalty, which was upheld by the first appellate authority. The appellant argued that Rule 8(3A) has been struck down by the High Court of Gujarat, with the Supreme Court staying the judgment's operation. Citing precedents, the appellant contended that the underlying basis of the judgment still applies despite the stay. The Tribunal found merit in this argument, setting aside the penalty under Rule 25(1)(a) of Central Excise Rules.

Issue 2: Availing CENVAT Credit twice on the same invoice and penalty imposed
The appellant availed CENVAT Credit twice on the same invoice, resulting in a penalty under Rule 15(1)(a) of CENVAT Credit Rules, 2004. The appellant sought a waiver, attributing the error to oversight due to the small amount involved, already paid with interest. The Department reiterated the lower authority's findings. The Tribunal acknowledged the small amount involved but deemed the penalty commensurate with the violation. Consequently, the Tribunal upheld the penalty of &8377; 2,000 imposed for availing CENVAT Credit twice on the same invoice.

In conclusion, the Tribunal modified the impugned order by setting aside the penalty imposed under Rule 25(1)(a) of Central Excise Rules, 2002 for contravention of Rule 8(3A) of Central Excise Rules, 2002. The decision was pronounced in open court on 25.01.2019.

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