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TMI Blog2003 (4) TMI 426X X X X Extracts X X X X X X X X Extracts X X X X ..... e manufacture of excisable goods falling under Chapters 32 and 38 of the Central Excise Tariff Schedule. They had opted for the facility of monthly payment of duty. Under that scheme, they had to pay duty for a given calendar month on or before the 15th day of the succeeding month. Under Rule 3(3) of the CENVAT Credit Rules, 2001, which was being followed by the appellants during the material period, they could utilize for payment of duty on their products, Cenvat credit to the extent available up to the last date of the calendar month in respect of which the duty was paid. When the appellants paid duty on the goods cleared during the months of September to December, 2001, they utilized Cenvat credit, on each occasion, in excess of what had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 03. 3. A show cause notice was issued by the Department on 26-7-2002 for recovering duty of Rs. 4,46,928/- from the party under Section 11A of the Central Excise Act, charging interest on the duty under Rule 8 of the Central Excise (No. 2) Rules, 2001 and for imposing penalty under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Central Excise Act. In their reply to this notice, the appellants submitted that they had already paid the duty with interest thereon. They also pleaded that no such penalty as proposed in the show cause notice was liable to be imposed on them in the particular facts and circumstances of the case. The defence against penalty is contained in the following paragraph of their reply : It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate authority. 4. Heard both sides. The learned Counsel for the appellants submits that where the amount of duty with interest thereon had been paid before issue of show cause notice, there was no reason to impose any penalty. He relies on the following decisions of the Tribunal :- Amritsar Crown Caps (P) Ltd. v. CCE - 2002 (140) E.L.T. 437 CCE v. Jkon Engg. (P) Ltd. - 2003 (151) E.L.T. 453 GEA Energy System (India) Ltd. v. CCE - 2003 (55) RLT 330 Bhiwani Textile Mills. v. CCE - 2003 (151) E.L.T. 365 The learned Counsel has particularly relied on the decision in Bhiwani Textiles Mills rendered by a Two-Members Bench of this Tribunal. In that case, it was held that wrong availment of Modvat credit could not be termed as non- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... take. Nevertheless, they did not care to rectify it. They rectified the mistake only three months later. The plea of oversight of the provisions of Rule 3 of the Cenvat Credit Rules cannot be accepted in law, nor the plea of inadvertent error, in the facts and circumstances of the case. 6. I have examined the rival submissions and arguments. The basic facts are not in dispute. Wrong availment of Cenvat credit to the extent of Rs. 4,46,928/- for payment of duty for the period September to December, 2001 is an admitted fact. It has also been submitted by the learned Counsel that this mistake was rectified only on 31-3-2003 i.e. after the filing of the present appeal. There is also no dispute of the fact that the Central Excise duty to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontravention of Rule 3(3) is an admitted fact. 8. The only question now to be considered is whether the contravention of Rule 3(3) was committed with intention to evade payment of duty. I have already extracted the pleadings of the party on this point, from their reply to the show cause notice. They submitted that it was an inadvertent error to have availed excess Cenvat credit at the time of payment of duty for the period September to December, 2001. During the months prior to September, 2001, they used to have more than enough Cenvat credit for discharge of duty liability for every calendar month. They happend to take excess credit for September to December, 2001 only by oversight of the provisions of Rule 3(3) of the Cenvat Credit Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X
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