2009 (12) TMI 352

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..... detection by the Department, the appellants reversed the credit on the impugned capital goods in November, 2005. Subsequently, the impugned capital goods were received back in January, 2008 and the appellants have taken re-credit of the amount reversed in November, 2005 in respect of which no objection has been raised by the Department, according to Shri N. Viswanathan, learned Counsel appearing on behalf of the appellants. 3. In the present proceedings an equal amount of penalty was initially imposed by the original authority on the ground that the appellants violated the Cenvat Credit Rules, 2004 inasmuch as they neither reversed the credit while removing the impugned capital goods to the job worker nor received back the same within the .....

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..... same was paid by way of reversal of credit as soon as it was pointed out to them and in any case the re-credit of the same has been taken by the appellants without any objection from the Department on ultimate receipt of the impugned capital goods in January, 2008. He argues that this is not a case where there was any suppression or mis-statement as initially the impugned capital goods were removed under the prescribed challan to the job worker. He states that Rule 14 and Rule 15(2) apply to cases where Cenvat credit is taken or utilized wrongly. Rule 15(2) has an added condition that it should be on account of fraud, suppression etc. He pleads that this was not a case of taking the Cenvat credit wrongly or utilizing the same wrongly. There .....

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..... pugned goods from the job worker and on such receiving back, the entire amount of credit involved has again been allowed by the Department to be re-credited to the account of the appellants, this can hardly be held to be a case of mis-statement, fraud, suppression etc. In any case, as argued by the learned Counsel, Rule 15(2) clearly applies in respect of cases where credit has been taken or utilized wrongly whereas this was a case of contravention of Rule 3(5) of the Cenvat Credit Rules, 2004. In my considered view, such contravention would attract penal provisions not under Rule 15(2) but under the second part of Rule 15(1) which applies to contravention of any of the provisions of the Rules in respect of any input or capital goods. A con .....

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