2011 (11) TMI 294

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.... Vs. Commissioner C. Ex., Chandigarh, 2010(255)E.L.T 201 (P&H) in the assessee's own case. In fact, notice was issued to the revenue only in respect of the following substantial questions of law: -   (iii) "Whether the order passed by the Tribunal is correct in imposing penalty on the appellants when the issue involved in the present case relates to interpretation of the Cenvat Credit Rules. (iv) Whether the order passed by the Tribunal is correct in imposing penalty on the appellants when the Department in its appeal before Tribunal had not challenged the non imposition of penalty by the Adjudicating Authority."   Learned counsel for the appellant has pointed out that in respect of the period prior to September 2001, the....

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....edit on the said product is declared as illegal and is recoverable by the department, along with interest thereon in terms of provision of law comprised under Rule 12 of the Cenvat Credit Rules, 2002 read with Section 12A of Central Excise Act, 1944 and Section 11AB of the said Act. The respondents are also liable to be subject to penalty of equal amount in terms of Rule 13(2) read with Section 11AC of the Central Excise Act, 1944. Order accordingly, Appeal is allowed with consequential relief."   Learned counsel for the assessee has vehemently argued that once, the Adjudicating Authority for the earlier period has taken a view that there is no mala fide intention in the claim of the Modvat credit by the assessee and the revenue has....

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.... that stand and in that regard, submissions made in para 5 of the judgment were noticed by their Lordships in Union of India vs. Rajasthan Spinning and Weaving Mills 2009(238) E.L.T. 3 (S.C.). The Hon'ble Supreme Court accordingly held as under: -   "23. The decision in Dharamendra Textiles case must, therefore, be understood to mean that though the application of Section 11AC would depend upon the existence or otherwise of the conditions expressly stated in the section, once, the section is applicable in a cas the concerned authority would have no discretion in quantifying the amount and penalty must be imposed equal to the duty determined under sub-section (2) of Section 11A. That is what Dharamendra Textiles decides.   24....