2011 (11) TMI 551

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.... S. Mehta, Advocate, for the Respondent. ORDER An offence case was registered against M/s. Princeware International Pvt. Ltd. for availing Cenvat credit wrongly which culminated in confirmation of duty demand with interest and penalty. The two appellants in this case are Shri Pratap Bhanushali Senior Manager-cum-authorized Signatory and Shri Falgun Shah, Senior President of the company. The ....

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....vat credit was wrongly taken by the company and not by the two individuals against whom penalty was imposed. However, he also observed that the correct rule to apply in this case would be Rule 26(1) of Central Excise Rules, 2002 which relates to abetment. He took the view that under Rule 26 also no penalty can be imposed since the rule requires that goods should have been held liable to confiscati....

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....nner deals with, any excisable goods which he knows or has reason to believe are liable to confiscation under the Act or these rules, shall be liable to a penalty not exceeding the duty on such goods or two thousand rupees, whichever is greater. (2) Any person, who issues - (i)     an excise duty invoice without delivery of the goods specified therein or abets in mai....

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....hich Cenvat credit has been wrongly taken cannot be confiscated, the question of any person having knowledge or reason to believe that offending goods are liable to confiscation cannot arise in this case. This is a clear case where offending goods are not liable to confiscation at all. Therefore Rule 26(1) is definitely not applicable to the facts of this case. It was also submitted by the learned....