2005 (7) TMI 549 - AT - Central Excise

Summary

Issues:
1. Disposal of stay petitions arising from the same impugned order.
2. Admissibility of Cenvat credit at a higher rate than prescribed.
3. Time bar for issuance of Show Cause Notices (SCNs) and imposition of penalties.
4. Financial hardship plea and evidence submission by the appellants.

Analysis:

Issue 1:
The Appellate Tribunal disposed of stay petitions collectively arising from the same impugned order confirming duty demands and penalties against the appellants. The demands included duty amounts against M/s. Suryanarayan Silk Mills Pvt Ltd., M/s. Jayesh Silk Mills, and M/s. Sunday Exports Ltd., along with personal penalties imposed on the Director of each firm.

Issue 2:
The appellants, registered dealers of grey fabrics, availed Cenvat credit at a rate higher than the prescribed 6%. The Revenue contended that the credit should have been at 6% per Notification No. 35/2003-C.E. The appellants argued that they believed in good faith to avail the higher credit and passed it on to their customers. The Commissioner noted the excess credit availed and rejected the appeal, upholding the demand against the appellants.

Issue 3:
Regarding the time bar for SCNs issuance, the Commissioner found the SCNs issued within the permissible period, rejecting the appellants' plea of time bar. The Commissioner upheld the demand and imposed penalties under Rule 13 of the Cenvat Rules, 2002, as the SCNs were issued before the due date for filing quarterly returns.

Issue 4:
The Tribunal observed that the appellants did not contest the entitlement to 6% Cenvat credit as per Notification 35/2003 (NT). The Tribunal directed the appellants to reverse the excess credit availed and deposit the entire amount within ten weeks. The Tribunal noted the absence of a financial hardship plea or supporting evidence from the appellants. Penalties imposed on the dealer and the Director were dispensed with subject to compliance with the deposit directive.

This detailed analysis summarizes the legal judgment comprehensively, addressing all the issues involved and the Tribunal's decisions on each matter.