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TMI Blog2010 (9) TMI 1046X X X X Extracts X X X X X X X X Extracts X X X X ..... 564/- along with interest and equal amount of penalty, besides penalty of ₹ 1,50,000/- upon the Director of M/s. Atul Generators (P) Ltd. 5. The contention of the Department was that, the appellants had wrongly availed the Cenvat credit, whereas it was the defence of the appellants that whatever amount stated to have been wrongly availed as Cenvat credit has already been reversed by the appellants. The adjudicating authority thereupon passed the said order dated 22nd July, 2009 which reads thus : I have carefully gone through the records, brief facts of the case, allegation contained in the show cause notice, defence reply and record of personal hearing held on 29-8-2008. And I find that the following issues in the case are to be decided on merits. 1. Whether inadmissible Cenvat credit of service tax amounting to ₹ 5,07,564/- is liable to be recovered from the party under rule 14 of Cenvat credit Rules, 2004 read with Section 11A(1) of the Central Excise Act, 1944 by way of invoking the extended period. 2. Whether interest is liable to be recovered from the party under rule 14 of Cenvat Credit Rules, 2004 read with provisions of Section 11AB of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch the fact of sale of electricity to other unit was never disclosed to the department. As regard audit objection based on record, the same was pointed out in the unit of M/s. Atul Engg. Udyog not in the unit of M/s. Atul Generators (P) Ltd., Nunhai, Agra. Therefore, it is not correct to say that nothing has been suppressed. I further observe that the party deliberately and knowingly suppressed the material fact from the department with a mala fide intention to avail inadmissible credit and to mis-utilize the same to defraud the govt s legitimate revenue, hence to recover the inadmissible credit, extended period of limitation under Section 11A(1) of Central Excise Act has rightly been invoked. Accordingly I hold that credit of ₹ 5,07,564/- wrongly availed and utilized by the party on account of service tax paid on transportation of CNG used in the manufacture of electricity which was sold out to other units is inadmissible and is liable to be recovered under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11A(1) of Central Excise Act, 1944. The party is also liable to pay interest under Section 11AB of the Central Excise Act, 1944. As far as imposition of pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he stay application/delay condonation along with appeal together. I have carefully gone through the records, brief facts of the case, allegation contained in the show cause notice, defence reply and I find that the following issues in the case are to be decided on merits : 1. Whether inadmissible Cenvat credit of service tax amounting to ₹ 507564/- is liable to be recovered from the appellant under rule 14 of Cenvat credit Rules, 2004 read with Section 11A(1) of the Central Excise Act, 1944 by way of invoking the extended period. 2. Whether interest is liable to be recovered from the appellant under rule 14 of the Cenvat Credit Rules, 2004 read with Section 11AB of the Central Excise Act, 1944. 3. Whether penalty equal to the amount of Service tax credit wrongly availed and utilized; is liable to be imposed under rule 15(2) Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. As regards point no. (1), I find that the party had taken the credit of service tax paid on transportation of CNG up to unit through pipeline which was used by them for production of electricity which was not only used in the manufacture of final ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit of ₹ 5,07,564/- wrongly availed and utilized by the appellant on account of service tax paid on transportation of CNG used in the manufacture of electricity which was sold out to other units is inadmissible and is liable to be recovered under Rule 14 of Cenvat Credit Rules, 2004 read with Section 11A(1) of Central Excise Act, 1944. The party is also liable to pay interest under Section 11AB of the Central Excise Act, 1944. As far as imposition of penalty is concerned, I observe that the appellant has deliberately suppressed the material facts and intentionally taken the inadmissible credit of ₹ 5,07,564/- though they knew that they were not entitled to avail and utilize the credit of service tax paid on transportation of CNG used in the production of electricity sold out to other units. Therefore, I hold that they are liable to penal action under Rule 15(2) Cenvat Credit Rules, 1994 read with Section 11AC of Central Excise Act, 1944. As regards imposition of personal penalty upon Shri Ram Saran Mittal, Director of M/s. Atul Generators (P) Ltd., Nunhai, Agra under rule 26 of Central Excise Rules, 2002, I observe that being Director of the firm, Shri Ram Sara ..... X X X X Extracts X X X X X X X X Extracts X X X X
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