TaxTMI 
TaxTMI 
2015 (11) TMI 1043
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....ppellants agreed with whatever was suggested by the audit party and reversed the cenvat credit taken along with interest. The details have been tabulated in the show-cause notice and the learned counsel for the appellants explained each item of the credit. a) Appellant had availed cenvat credit on motor vehicles falling under Chapter 87 amounting to Rs. 2,83,562/- (Rupees Two Lakhs Eighty Three Thousand Five Hundred and Sixty Two only). The learned counsel agrees that this was wrongly taken by mistake. b) An amount of Rs. 5,20,474/- (Rupees Five Lakhs Twenty Thousand Four Hundred and Seventy Four only) being cenvat credit availed on input services received from abroad was held to be inadmissible. The learned counsel submitted that app....
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....payment of service tax. The issue of irregular availment has come to the notice only after the accounts of the assessee were audited. M/s. Gland has not disclosed the same in their returns filed with the Department. In view of the above, the cenvat credit irregularly availed by the assessee is to be disallowed under Rule 14 of the Cenvat Credit Rules, 2004 read with proviso to Section 73(1) of the Finance Act 1994." 3.1. It can be seen that this is the paragraph which is the foundation for confirming the demand invoking extended period for wrongly availed cenvat credit, demand for interest and imposition of penalty under Rule 15 read with Section 78 of Finance Act 1994. In this paragraph it has been stated that M/s. Gland has not disclos....
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....t has been wrongly taken, even if it has not been utilized, in terms of wording of the present Rule 14. As I am bound by the above Board Circular, I am fully convinced that interest under Rule 14 read with Section 75 of the Act, is payable by them. Rule 15(1) of the Cenvat Credit Rules, 2004 says if any person takes cenvat credit in respect of inputs and capital goods wrongly or in contravention of any of the provisions of Cenvat Credit Rules, such person shall be liable to a penalty'. Hence, I proceed to levy penalty under Section 78 of the Act, as the assesses have availed credit irregularly and such irregularity could not have not come to the notice of the Department but for audit of the accounts. As I intend to levy penalty under Sect....
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....20/- (Rupees Twenty Seven Lakhs Sixty Seven Thousand Seven Hundred and Twenty only) equivalent of irregular Cenvat credit availed by the appellants, they contended that though they might have availed certain credits for which they are ineligible, such act of availing the credit is not with intention to evade any tax. They immediately reversed the credit to the tune of Rs. 27,67,720/- (Rupees Twenty Seven Lakhs Sixty Seven Thousand Seven Hundred and Twenty only) on being informed by the Audit Officers. The lower authority in the impugned order held that it is clear in the Cenvat Credit Rules, 2004 the Rule 15(1) says 'if any person takes Cenvat Credit in respect of inputs and capital goods wrongly or in contravention of any of the provision ....
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....idered any of the aspects as mentioned by me in the case of order-in-original. 4. This is a case where the statutory provisions have not been considered, the foundation for levy of penalty and demand of credit, interest etc. does not even contain the name of the party and it is not necessary to go into all omissions and commissions which exist in the proceedings. In this case I find that penalty under Section 78 can be set aside by invoking provisions of Section 80 of Finance Act 1994 in view of the fact that the appellant definitely did not have any intention to evade tax which comes out clearly from the reversal of credit without any question as to the correctness of the observations of the audit party with interest. Apparently the app....