TaxTMI 
TaxTMI 
2013 (11) TMI 1220
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....225/-. This duty liability was paid by the appellant on 01/04/2007 from the Cenvat Credit of capital goods earned on 01/04/2007. As per sub-rule 3 (4) of Cenvat Credit Rule, 2004, it is provided that "while paying duty of excise or service tax, as the case may be, the CENVAT credit shall be utilized only to the extent such credit is available on the last day of the month or quarter, as the case may be, for payment of duty or tax relating to that month or the quarter, as the case may be" for payment of duty. Therefore, utilization of the Cenvat Credit to the extent of Rs.1,60,225/- on01/04/2007 by the appellant was wrong. The appellant made good the said payment through PLA account on 30/04/2008 along with interest of Rs.22,831/-.Vide letter dated 08/05/2008, the appellant also informed the department about the mistake in payment of duty and the subsequent rectification. Thereafter, the department issued a show-cause notice dated 02/06/2008 alleging that there was a default in payment of duty of Rs.1,60,225/- which continued from 01/04/2007 to 30/04/2008 and therefore, during the said period, the appellants should have discharged the duty liability on the goods cleared by paying dut....
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.... Delhi in the case of Commissioner of Central Excise,Chandigarh Vs. Raison Carbon Black Ltd. as reported in 2008 (29) ELT 113 (Tri-Del). 2.2 On the basis of the above conclusion, the adjudicating authority confirmed the duty demand of Rs.3,86,65,370/- along with interest thereon and also imposed a penalty of Rs.50 lakhs for wrong utilization of the Cenvat Credit. Aggrieved of the same, the appellant is before us. 3. The Ld. Counsel for the appellant made the following submissions: 3.1 The outstanding amount of Rs.1,60,225/- as on 31/03/2007 was made goods by the appellant on 01/04/2007 by wrongly utilizing the Cenvat Credit amount lying with the appellant on 01/04/2007. As per Rule 3 (4) of the Cenvat Credit Rules, 2004, the appellant could not have utilised the Cenvat Credit for payment of duty for the month of March 2007, as the credit has been earned only in April, 2007. Thus, it was a question of wrong utilization of credit that is involved in the present matter. If the credit has been wrongly utilised the appropriate provisions for recovery of the same is Rule 14 of the Cenvat Credit Rules, 2004 and therefore, the invocation of Rule 8 of Central Excise Rules, 2002 in ....
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....Act but that will follow even if it is not mentioned in the Rules. That is to say duty paid during the defaulting period will be proper discharge once the default in payment from PLA, for the month of Dec. 2006 in this case, is made good and applicable interest is paid. With the result the only consequence that arises in this case is payment of interest and penalty. But interest will be payable from the date of each clearance to the date on which the default is made good that is 20-4-2007. This is so because once the defaulted amount is paid, thereafter the payment made through Cenvat become proper even if it is paid before the date on which defaulted amount is paid. So we do not find it necessary to ask the Appellant to pay duty in cash and take re-credit of equivalent amount debited in Cenvat Credit account earlier". 3.4 These decisions of the Tribunal have been followed by this Tribunal in a number of other decisions, such as, Bactolac Formulations Pvt. Ltd., Vs. CCE., Venkatesh Automobiles Pvt. Ltd., Vs. CCE & F.S.Engineer Vs. CCE, Ahm-II. As per these decisions, once the duty payment has been made good along with interest thereon, it cannot be said that the availment of Cen....
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....he sides. 6.1 It would be appropriate at this juncture to refer to the evolution of Central Excise law after the introduction of self assessment and payment of duty on monthly basis by the assessee themselves. Prior to 1996, the Central Excise assessee was required to discharge excise duty liability at the time of removal of goods from the factory. In other words the payment was made prior to the clearance of the goods even without realizing the duty from the Customers. Therefore, as a matter of concession to the assessee, the facility for payment of duty on fortnightly payment was introduced by the Government and the assessee was required to pay excise duty liability on the goods cleared as a fortnightly basis. Later, on this facility was further extended to provide for monthly payment of duty. This was a facility granted to the assessee so as to give certain reliefs in the matter of payment of duty. When these provisions were evaluated after a lapse of time, it was noticed by the Government that certain assesses were misusing the facilities. In other words, they were not discharging the excise duty liability at the end of the month as provided for in the law. Therefore, as a m....