2007 (6) TMI 396 - AT - Central Excise

Summary

Issues: Department's appeal against Commissioner (Appeals) order, Cenvat credit reversal, imposition of penalty, applicability of Section 11B of the Act.

The judgment pertains to the Department's appeal against the order of the Commissioner (Appeals) regarding the reversal of Cenvat credit. The respondent had received POY from various manufacturers and claimed Cenvat credit based on duty paid documents. Subsequently, officers persuaded to debit the credit based on a credit note from a supplier, but upon investigation, it was found that the debit was unwarranted as there was no change in the assemble value and duty paid at the supplier's end. The appellant reinstated the credit and informed the Commissionerate accordingly. The original authority confirmed a demand and imposed a penalty. The Commissioner (Appeals) noted that the credit note issued by suppliers did not affect the duty paid on inputs and observed that the credit was debited unlawfully by excise officials without proper investigation at the supplier's end. Consequently, the appeal was allowed, citing that Section 11B of the Act was not applicable due to the unlawful manner in which the credit was debited.

The appellant contended that no valid grounds were presented to challenge the findings and reasoning of the Commissioner (Appeals). The Tribunal rejected the appeal based on the lack of substantial evidence to dispute the Commissioner's decision. The judgment emphasizes the importance of proper investigation and lawful procedures in matters concerning the reversal of Cenvat credit, highlighting the need for adherence to statutory provisions and due process.