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TMI Blog2008 (1) TMI 806X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Rule 13 of Cenvat Credit Rules 2001-2002 along with recovery of interest. Commissioner (Appeals) set aside the penalty but upheld the denial of credit and recovery of interest. 2. The learned advocate on behalf of the appellant submits that the Hon ble Rajasthan High Court in the case of CCE, Jaipur v. M/s. Neer Shree Cement Ltd., Excise reference No. 9 of 2002 dated 8-8-2003 rejected the reference application filed by the revenue against admissibility of credit on welding electrodes. He further submits that in any event, the appellant had taken the credit but not utilized and therefore recovery of interest is not justified. In this connection, he relied upon the decision of the Hon ble Punjab Haryana High Court in the case of CCE, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng purpose. Regarding recovery of interest, he submits that the case laws cited by the learned advocate are under Rule 57(I) of the erstwhile Central Excise Rules, 1944. He submits that the present case relates to Rule 12 of Cenvat Credit Rules 2001/02, wherein it is categorically specified that Cenvat credit has been taken or utilized wrongly or has been erroneously refunded, the same shall be recovered along with interest from the manufacturer. He submits that Rule 12 particularly indicates for recovery interest when Cenvat credit taken wrongly, which was not mentioned in Rule 57(I) of the erstwhile Central Excise Rules. He submits that the appellant is liable to pay interest for taking of the credit even it was not utilized by them. 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le Central Excise Rules, 1944. So, the relevant portions of the said Rules 57(I) are reproduced below : (3) Where a manufacturer or an assessee fails to pay the amount determined under sub-rule (1) or sub-rule (2) within three months from the date of receipt of demand notice, he shall pay, in addition to the amount so determined, interest at such rate, as may be fixed, by the Central Board of Excise and Customs under Section 11AA of the Act, from the date immediately after the expiry of the said period of three months till the date of payment. xxx xxx xxx xxx (5) Notwithstanding anything contained in clause (iii) of sub-rule (1) or sub-rule (3), where the credit of duty paid on inputs has been taken wrongly on account of fra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alty is ordinarily levied on an assessee for some contumacious conduct or for a deliberate violation of the provisions of the particular statute. Interest is compensatory in character and is imposed on an assessee who has withheld payment of any tax as and when it is due and payable. The levy of interest is geared to actual amount of tax withheld and the extent of the delay in payment the tax on the due date. Essentially, it is compensatory and different from penalty - which is penal in character. The Hon ble Supreme Court in the case of Bombay Dyeing Mfg. Co. Ltd. (supra) held as under : 8. However, when we come to the exemption on grey fabrics was admissible subject to the assessee paying duty on yarn before claiming exemption and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... take advantage of utilize . The meaning given in Oxford Dictionary is also to the same effect. Webster s Dictionary makes avail synonymous with benefit profit use and utility . A person can be stated to have availed himself of something only if he had taken advantage or profited by that thing or utilized it to his benefit. 9. It is seen from the aforesaid case laws that the payment of interest is arising out of withholding of the actual amount of tax and delay in paying the tax on the due date. To my mind, the expression taken under Rule 12 of Cenvat Credit Rules covers the situation where the assessee is benefited himself by taking credit. Further, Rule 12 provides recovery of interest and the provisions of Sections 11A and 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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