2008 (12) TMI 614

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....respect of which Cenvat credit amounting to Rs. 1,97,828/- had been taken, was lying in stock. The point of dispute is as to whether this credit was required to be reversed when the respondent switched over to SSI exemption scheme. The Commissioner (Appeals) vide the impugned order-in-appeal dated 3-3-06, relying upon the Tribunal's judgment in case of CCE v. Ashok Iron & Steel Fabricators reported in 2002 (140) E.L.T. 277, held that the credit on the inputs lying in stock was not required to be reversed. Another issue in this case is regarding duty on scrap. The Commissioner (Appeals) in the impugned order upheld the demand of duty amounting to Rs. 32,000/- on the scrap but he reduced the penalty on the Appellant to Rs. 32,000/- in view of....

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....ying in stock as well as contained in finished goods lying in stock as on the date of exemption, is required to be reversed. In view of this, he pleaded that the Commissioner (Appeals)'s order setting aside the demand of Cenvat credit of Rs. 1,97,828/- is not correct. He also pleaded that the Commissioner (Appeals)'s order reducing the penalty under Section 11AC to Rs. 32,000/- was also not correct. On the issue of setting aside the penalty on Shri D.M. Rojinder, Proprietor of the respondent firm, he pleaded that penalty on Shri D.M. Rojinder had been correctly imposed and the Commissioner (Appeals) has set aside the penalty without any justification. 2.1 Shri Atul Gupta, Company Secretary, the ld. Counsel for the respondent pleaded....

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....y to impose a separate penalty on proprietor under Rule 209A. 3. I have carefully considered the submissions from both the sides. As regards the first issue as to whether Cenvat credit of Rs. 1,97,828/- in respect of inputs lying in stock as on 1-4-99, when the respondent firm switched over to SSI exemption and the finished product of the Respondent became fully exempt of duty is to be reversed or not, the Larger Bench of the Tribunal in a recent judgment in the case of HMT & Others v. CCE, Punchkula (supra) and earlier five Members Bench of the Tribunal in the case of CCE, Rajkot v. Ashok Iron & Steel Fabricators reported in 2002 (140) E.L.T. 277 has held that in such a situation, the credit on the inputs lying in stock and the inp....