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TMI Blog2010 (8) TMI 428X X X X Extracts X X X X X X X X Extracts X X X X ..... ng requirement of imposition of penalty are not attracted and hence the authorities below erred in imposing the penalty - The penalty imposed against the appellants quashed. - E/110/2005 - 623/2010-EX(PB) - Dated:- 11-8-2010 - Justice R.M.S. Khandeparkar, Shri Rakesh Kumar, JJ. REPRESENTED BY : Shri Ashok Sagar Advocate, for the Appellant. Shri R.K. Verma, JDR, for the Respondent. [Order per : Justice R.M.S. Khandeparkar, President]. - Heard the learned advocate for the appellants and the learned DR for the respondent. 2. The appellants challenge the order dated 18-10-2004 passed by the Commissioner (Appeals), Chandigarh, whereby the appeal filed by the Department against the order passed by the lower authority in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , taking of the Modvat credit prior to the commissioning of the plant was irregularity on the part of the appellants and they having suo motu reversed the credit with the intention to avail the same on completion of installation of capital goods and actually having accordingly availed the same, there was no case warranting for forfeiture of the Modvat credit and hence no penalty was imposed. Being aggrieved, the matter was carried in appeal by the Department insisting for imposition of penalty on the ground that such an action is warranted under Rule 173Q(1)(bb) of the Central Excise Rules, 1944. Accepting the contention on behalf of the Department, the Commissioner (Appeals) while allowing the appeal imposed the penalty of Rs. 50 lacs agai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exceeding three times the value of the excisable goods, in respect of which any contravention of the nature referred to in clause (a) or clause (b) or clause (bb) or clause (bbb) or clause (c) or clause (d) has been committed, or five thousand rupees, whichever is greater. 7. Undisputedly, in the matter in hand, the order passed by the adjudicating authority discloses a clear finding to the effect that taking of Modvat credit prior to commissioning of the plant was irregular and hence the appellants had suo motu reversed the same. The findings arrived at by the Commissioner (Appeals) also disclose that, within fortnight from the day it was brought to the notice of the appellants about the said irregularity, the appellants suo motu had re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llants thereupon admitted the lapse and thereafter suo motu reversed the credit on 14th July, 1998. 10. All the above facts which were on record clearly disclose total absence of mal-intention or intention to avail and utilize the credit in contravention of the provisions of law. In the peculiar facts and circumstances of the case, therefore, we are of the considered opinion that the provisions regarding requirement of imposition of penalty are not attracted and hence the authorities below erred in imposing the penalty 11. In the result, therefore, the appeal succeeds. The penalty imposed in the matter against the appellants as well as the authorized signatory is hereby quashed. The appeal stands disposed of accordingly. - - TaxTMI - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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