Confiscation and penalty (Rule 15(1) and 15 (2) of the CCR): - Central Excise Practice Manual (OLD) - Central Excise

19. Confiscation and penalty (Rule 15(1) and 15 (2) of the CCR): If any person takes Cenvat Credit for inputs or capital goods wrongly or contravenes any provisions of the CCR in respect of any inputs or capital goods, then, all such goods shall be liable to confiscation and such person shall also be liable for penalty not exceeding the duty on such goods for which contravention has been committed or Rs. 2,000/- whichever is greater. If Cenvat Credit is taken/utilized wrongly by fraud, wilful misstatement, collusion or suppression of facts, or contravention of any provisions of the Act / Rules, with intent to evade payment of duty, the manufacturer shall also be liable to penalty under Section 11AC of the Central Excise Act. If any person takes Cenvat credit for input services, wrongly or contravenes any of the provisions of these rules, such person shall be liable to a penalty not exceeding Rs. 2,000/- If Cenvat credit in respect of input services has been taken or utilized wrongly by reason of fraud, collusion, wilful mis-statement, suppression of facts or contravention of any of the provisions of the Finance Act, 1994 or the rules made thereunder with intent to evade payment of Service Tax, then the provider of output service shall be liable to pay penalty in terms of the provisions of Section 78 of the Finance Act, 1994.