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TMI Blog2010 (4) TMI 341X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the period of dispute i.e. 2006-07, they were availing the benefit of SSI exemption under Notification No. 8/03-C.E. At the tune of opting for 551 exemption under Notification No. 8/03-C.E. w.e.f. 1-4-06, the Appellant had reversed the Cenvat credit involved on the cenvrted inputs lying in the stock or in process or contained in the finished products lying in stock as on 31-3-06 and out of the total Cenvat credit to be reversed Rs. 6,03,462/- an amount of Rs. 2,43,421/- was reversed through RG 23A Part II account and the balance amount of Rs. 3,60,041/- was reversed by debit entry No. 8 dated 4-4-06 in the PLA. Accordingly w.e.f. 1-4-06, the Appellant started availing the 5Sf exemption under Notification No. 8/03-C.E. under which, the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable rate as per the provisions of Section 1IAB; (b) penalty of amount equal to the duty amount confirmed i.e. Rs. 16,46,041/- was imposed on the Appellant under Section 11AC of Central Excise Act, 1944 and (c) penalty of Rs. 2,50,000/- was imposed on the Appellant company on the ground that they are also liable for penalty under Rule 25 of Central Excise Rules, 2002 and goods cleared without payment of duty are liable for confiscation though the same are not available for confiscation. 1.3 The Appellant filed an appeal before the Commissioner (Appeals) against the Jt. Commissioner's order and Commissioner (Appeals) vide order-in- appeal No. IND-I/45/2009 dated 5-3-09 upheld the Jt. Commissioner's order and dismissed the appeal. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the period from 1-4-06 to 15-6-06 was Ks. 9,34 that on 16-6-06 when the Appellant started paying duty as they had crossed the one crore limit on 15-6-06, they were eligible for Cenvat credit amounting to Ks. 8,67,927/- (Rs. 8,50,910/- Cenvat duty credit + Rs. 17,017/- education cess credit) in respect of the inputs lying in stock at that time, that prior to 16-6-06, the Appellant had reversed the credit of Rs. 78,026 (Rs. 65,015 + education cess credit of Rs. 13,011) and thus in any case, the Cenvat credit al ready taken by the Appellant by mistake during 1-4-06 — 15-4-06 period was of the amount to which they were entitled when they switched over to duty paying status; that there was no intention to wrongly avail the 551 exemption a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r home consumption and that since in this case, input duty credit had been taken, the condition of the notification has been violated and hence the Appellant would not be eligible for exemption. 3. We have carefully considered the submissions from both the sides and perused the records. The Appellant had started availing of SSI exemption w.e.f. 1-4-06 and before opting for SSI exemption, as per the provisions of Rule 11(2) of the Cenvat Credit Rules, 2004, the Cenvat credit involved on the inputs lying in stock or in process or contained in the finished products lying in stock as on 31-3-06 had been reversed and thus as such as on 14-06, they had Nil input duty Cenvat credit. The Appellant started availing of full exemption in respect of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period of exemption had been taken due to mistake and the mistake got rectified when at the time of crossing rupees one crore limit of clearances, and switch over to duty paying status, the Appellant, instead of making credit entry for taking Cenvat credit of duty on the inputs lying in stock or in the process as per the provisions of Rule 3(2), debited the credit of Rs. 78,026/- and thereby making the credit taken by them during 14-06 to 15-6-06 due to mistake, equal to their credit entitlement under Rule 3(2). In our view, therefore, it would not be correct to deny the benefit of SSI exemption to them. We find that the same view had been taken by the Tribunal in the case of Sagar Twisters v. CCE (supra). We, therefore, hold that the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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