2010 (10) TMI 881

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e but brought out from the open market and the same also not as an input of final product of "Tooth Paste" and the cost of Tooth Brush is also not added in the MRP? [B] Whether the CESTAT has justified in the eyes of law in setting aside a penalty which has been imposed upon the assessee for contravention of Cenvat Credit Rules, in respect of wrongly availment of Cenvat Credit on "Tooth Brush?" 2. Heard Ms. Amee Yajnik, learned Senior Standing Counsel for the appellant-revenue and perused the orders passed by the authorities below. 3. The respondent-assessee, M/s. Prime Health Care Products is engaged in the manufacture of Tooth Paste falling under Chapter Sub-Heading No. 3306.10 of the Central Excise Tariff Act, 1985 and ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....osed penalty of Rs. 17,85,690/- and also charged interest at an appropriate rate. Penalty of Rs. 1,00,000/- was also imposed on Shri M.M. Shah, Partner and Rs. 25,000/- on Shri Kalpnath R. Mishra, Commercial Manager-cum-Authorized Signatory of the respondent-assessee. 5. Being aggrieved and dissatisfied by the said Order-in-Original dated 30-11-2004, the respondent-assessee filed appeal before Commissioner (Appeals), Central Excise, Daman, who vide his order dated 1-6-2005 held that the demand of duty of Rs. 17,47,975/- invoking extended period is not sustainable and demand of duty to the tune of Rs. 37,094/- for the month of December 2002 is upheld. He has also reduced the penalty to Rs. 37,094/- on the main concern as well as Rs. 5,....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....vat Credit Rules, 2004. Rule 3(1) of the Rules says that a manufacturer or producer of final product or a provider of taxable service shall be allowed to take credit of items mentioned therein. The proviso further states that the cenvat credit shall be allowed to be taken of the amount equal to central excise duty.................. paid on any input or capital goods received in the factory of manufacture of final product. The word "input" is defined in Rule 2(k) which also includes accessories of the final products cleared along with final product. There is no dispute about the fact that on toothbrush, excise duty has been paid. The toothbrush is put in the packet along with the tooth paste and no extra amount is recovered from the consumer....