TaxTMI 
TaxTMI 
2016 (12) TMI 101
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....- and appropriated or adjusted the said amounts reversed by them in CENVAT Credit account. Interest on the first amount confirmed as well as interest of Rs. 32,60,417/- on the other two amounts was also held to be payable. A further interest of Rs. 1,73,02,813/- was also held leviable on delayed discharge of tax liability in CENVAT Credit account between 2004-05 and 2007-08. Penalty of Rs. 1,54,40,250/- was also imposed under section 78 of Finance Act, 1994. 2. It was alleged that M/s Vodafone Essar Cellular Ltd had contravened the provisions of CENVAT Credit Rules, 2004 between 2004-05 and 2007-08 by taking credit of tax paid on input services on billed basis instead of payment basis leading to credit having been wrongly taken on tax am....
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....L-799-HC-KAR-CX] which held that that interest liability would arise only if, without taking into account ineligible credit, sufficient credit was not available on dates of payment of tax. In holding thus, the judgment distinguished the facts in Union of India v. Indo-Swift Laboratories Ltd [2011-TIOL-21-SC-CX] in which the Hon'ble Supreme Court had overruled the decision of the Hon'ble High Court of Punjab & Haryana by holding that even taking of CENVAT Credit erroneously was sufficient to invoke the interest liability. Further reliance was placed on Commissioner of Central Excise & Customs v. Sweet Industries [2011 (264) ELT 349 (Guj)], Chandrapur Magnet Wires (P) Ltd v. Commissioner Central Excise Nagpur [1996 (81) ELT 3 (SC)], Commissio....
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....ntative placed reliance on the decision of the Hon'ble High Court of Chhatisgarh in Commissioner of Central Excise & Customs, Raipur v. Vandan Vidyut Ltd [2016 (331) ELT 231 (Chhatisgarh)] and that of the Hon'ble High Court of Bombay in Commissioner of Central Excise Pune-I v. M/s GL&V India Pvt Ltd [2015-TIOL-1210-HC-MUM-CX] both of which allowed for no scope of deviation from the decision of the Hon'ble Supreme Court in re Ind-Swift Laboratories Ltd. 8. We take note of the decision of the Hon'ble High of Bombay in re M/s GL&V India Pvt Ltd: '9. Firstly, it is to be noted that the provisions of Rule 14 of the 2004 Rules have been elaborately considered and interpreted by the Apex Court. The Rule which falls for consideration before u....
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....output service becomes liable to pay interest along with the duty where Cenvat credit has been taken or utilized wrongly or has been erroneously refunded and that in the case of the aforesaid nature the provision of Section 11AB would apply for effecting such recovery. 17. We have very carefully read the impugned judgment and order of the High Court. The High Court proceeded by reading it down to mean that where Cenvat credit has been taken and utilized wrongly, interest should be payable from the date the Cenvat credit has been utilized wrongly for according to the High Court interest cannot be claimed simply for the reason that the Cenvat credit has been wrongly taken as such availment by itself does not create any liability of payment....
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.... Court was to be accepted, the same would amount to permitting the word "or" between "taken" and "utilized" to be substituted by "and". The Lordships therefore found that applying the principle of strict and liberal interpretation the same was not permissible. 13. In view of the clear pronouncement of law by the Apex Court, we find that the view taken by the learned Tribunal may be though correctly taken at that point of time, on the basis of the judgment of the Punjab & Haryana High Court, would no longer be correct in view of the subsequent judgment of the Apex Court in the case of Union of India v. Ind-Swift Laboratories Ltd. reported in 2011 (265) E.L.T. 3 (S.C.).' 9. It is thus clear that it was only consequent to the amendment o....