C.C.E. Delhi-Iii vs Shri Raj Kumar

[Arising out of Order-in-Original No. 167/SVS/GGN/2013 dated 18.03.2014 by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Delhi].

For approval and signature:

Honble Shri Ashok Jindal, Member (Judicial)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

C.C.E. Delhi-III .Appellants

Vs.

Shri Raj Kumar .Respondent

Appearance:

Shri R.K. Mishra, DR for the Appellants

Shri Manmohan Gupta, Advocate for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Date of Hearing: 30.04.2015

FINAL ORDER NO. 51497/2015-EX(SM)

Per Ashok Jindal:

Revenue is in appeal against the impugned order wherein Ld. Commissioner (A) has dropped the penalty against the respondent.

2. The facts of the case are that the respondent is a second stage dealer who procured goods from one M/s. All India Metal Traders, first stage dealer who procured the goods from M/s. Satya Metals located in Jammu and cleared the goods to M/s. All India Metal traders Delhi on payment of duty by availing benefit under notification No. 56/2002 which provides that a unit located in Jammu is required first to utilize the Cenvat Credit lying in their Cenvat Credit account and thereafter paying duty on clearance in DTA and also entitled to claim refund on the duty paid by them and duty paid by them is also entitled for Cenvat Credit to the buyer of the goods. It was alleged against M/s. Satya Metal, Jammu that they have passed inadmissible Cenvat Credit to the first stage dealer and thereof. In these circumstances, a show cause notice was issued to the appellant to impose penalty under Rule 26 of the Central Excise Rules 2002 for passing inadmissible Cenvat Credit to the manufacture buyers. The show cause notice was adjudicated penalty was imposed on the respondent which was challenged before the Ld. Commissioner (A) to hold that as proceedings against M/s. Satya Metal, Jammu has not attained finality, therefore, penalty was not required to be imposed on the respondent. Consequently, penalty imposed on the respondent was set aside. Against the said order Revenue is in appeal before me.

3. The Ld. AR submits that the Ld. Commissioner (A) is right in setting aside the penalty imposed on the respondent. In fact, he has to keep in abeyance till the decision in the case of M/s. Satya Metal, Jammu would have attained finality as the inadmissible Cenvat Credit has been passed on. Therefore, impugned order is required to be set aside.

4. Heard the Ld. AR and perused the record.

5. In this case the issue whether M/s. Satya Metal, Jammu has passed inadmissible Cenvat Credit or not is in dispute. Therefore, the arguments advance by the Ld. AR that inadmissible Cenvat Credit has been passed by the respondent is totally misconceived. When the issue of M/s. Satya Metal has passed inadmissible Cenvat Credit to the respondent is in dispute. Therefore, no penalty was required to be imposed by the Adjudicating Authority itself and show cause notice could have been kept in abeyance. But in over enthusiasm penalty has been imposed on the respondent by the Adjudicating Authority which has been considered by the Ld. Commissioner (A) in the impugned order and same has been set aside and now again in over enthusiasm that order has been challenged before me before attaining finality the issue of inadmissible credit passed by M/s. Satya Metal, Jammu.

6. In these circumstances, I do not find any infirmity with the impugned order and same is upheld. Appeal filed by the Revenue deserves no merits. Hence dismissed.

(Dictated and pronounced in the open court.)

(Ashok Jindal) Member (Judicial)

Bhanu

2

E/58435/2013-EX(SM)