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TMI Blog2017 (9) TMI 874X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the 'CENVAT credit availed Capital Goods' from their premises without payment of amount payable in terms of the provisions of Rule 3(5) of CENVAT Credit Rules, 2004; 2.2 Investigation in to the matter revealed that the appellant had entered into a Lease Agreement dated 07.01.2010 (Annexure-A.1) with M/s. Sree Balajee TMT Rod Mills Private Ltd., Aswathapuram Village, Kallur Mandal, Kurnool District leasing out the SMS Division (located in Part of land in Survey No.143 B/2) along with its equipment (Plant and machinery) to M/s Sree Balajee TMT Rod Mills Private Ltd., (SBTMT) for the purpose of manufacture of M.S. Ingots against certain monetary consideration. M/s. SBTMT have obtained separate Central Excise registration in the nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as admitted by the appellant vide statements/letters submitted, it appeared that they had removed the capital goods, on which CENVAT credit was availed, by leasing out to other manufacturers without payment of the amount required to be payable in terms of the provisions of Rule 3(5) of CENVAT Credit Rules, 2004; 2.6 The appellant had leased out the capital goods, on which CENVAT credit was availed, to other manufacturers and also transferred the physical possession and absolute control over the capital goods to the lessee. Consequently, lessee has utilized the capital goods so leased out to them, for manufacture of excisable goods by taking separate Central Excise Registration. The change of Ground Plans submitted by the appellant clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... housand two hundred and sixty seven only) under Section 11AC of the Central Excise Act, 1944 read with Rule 15(2) of the CENVAT Credit Rules, 2004 for contravention of the provisions as mentioned above. iv) I drop demand of Rs. 2,12,77,122/- in respect of capital goods leased to M/s Canara Overseas and Rs. 20,60,828/- in respect of capital goods leased to M/s SBTMT. Revenue has not filed any appeal against the impugned order. Appellant assessee is aggrieved by the impugned order for confirmation of demand of Rs. 18,31,267/- with interest and penalties. 4. Ld. Counsel submits that the impugned order is not correct in confirming the demand. It is his submission that appellants could not discharge the duty liability on the capital goods sol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsaction value. In the present case, the amount calculated at is arrived at Rs. 18,31,267/- where as the duty paid on transaction value is arrived at Rs. 13,42,844/-. Since the amount calculated as per the provisions of Rule 3(5A) are higher than the amount of duty paid on transaction value, the amount payable by the assessee is Rs. 18,31,267/-. 33. The assessee in their reply to the show cause notice submitted that they arrived at Rs. 31,42,844/- towards CENVAT credit liable to be paid as per provisions of Rule 3(5A) of CENVAT Credit Rules, 2004. The said amount was paid by them. The show cause notice alleges that the assessee removed capital goods without raising invoice and payment of appropriate amount. The assessee contested that they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion and accordingly invoking extended period is sustainable. 34.1 The assessee has relied on certain case laws regarding invoking extended period. I am not going into the merits of these cases, as they are different from the assesses case and there is a clear evidence that the assessee has suppressed the removal of the capital goods without intimating the department and following the procedures as laid down the in the central excise rules for removal of capital goods. Accordingly, they are liable to penal action under Section 11AC of the Central Excise Act, 1944. 9. In my considered view, the above said findings of the adjudicating authority are flawless and needs to be upheld. There is no dispute that appellant had not discharged the d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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