M/S. Unimech Industries Pvt. Ltd vs Commissioner Of Central Excise, ...
- CitationAppeal No.CMB-CEX-000-APP-303 & 304-12, both dated 22.11.2012 passed by the Commissioner o
Ratio decidendi
The rule this decision rests on
Under Rule 15(1) of the Cenvat Credit Rules, 2004, credit on capital goods is admissible only for use in the factory of the assessee where those capital goods are to be installed; installation of capital goods at a place other than the registered factory of the assessee therefore contravenes Rule 15(1), attracting penalty under that rule. Penalty under Rule 26(2) of the Central Excise Rules, 2002 requires a finding of mala fide intent; where the record does not show that the assessee acted mala fide in transferring capital goods between units, and the transfer was occasioned by a power failure at the place of manufacture, no penalty under Rule 26(2)(i) is leviable.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
[Arising out of Orders-in-Appeal No.CMB-CEX-000-APP-303 & 304-12, both dated 22.11.2012 passed by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Coimbatore]
M/s. UNIMECH INDUSTRIES PVT. LTD. APPELLANT
Versus
COMMISSIONER OF CENTRAL EXCISE, COIMBATORE RESPONDENT
Appearance:
For the Appellant Shri Ravi Kumar, [No vakalat on file] Adv.
For the Respondent Shri L. Paneerselvan, AC (AR)
CORAM:
Honble Shri D.N. Panda, Judicial Member
Date of hearing/decision 03-09-2015
FINAL ORDER NOs. 41187-41188 / 2015
Shifting of the capital goods from one place to another and the units located thereat were two different SSI units which were registered differently. Law relating to capital goods credit permits credit for use in the factory of assessee where the capital goods ought to have been installed. Therefore, installation thereof by assessee at a different place resulted in contravention of the provision of the law appearing in Rule 15 (1) of the Cenvat Credit Rules, 2004. Accordingly, levy of penalty under that rule by Commissioner (Appeals) is correct. Therefore, that aspect of his order is confirmed.
2. So far as penalty under Rule 26 (2) is concerned, it does not appear from the record that the appellant had malafide to transfer the capital goods from one unit to another but for the power failure in a particular area i.e., at the place of work where manufacturing activity is carried on, there shall be no penalty under Rule 26 (2) (i) of Central Excise Rules, 2002. Consequently, both the appeals are allowed partly to the extent indicated above. (Dictated and pronounced in open court)
(D.N. PANDA) JUDICIAL MEMBER
ksr 10-09-2015
DRAFT Remarks
I II III
Date of dictation 03.09.2015
Draft Order - Date of typing 05.09.2015
Fair Order Typing 10.09.2015
Date of number and date of dispatch 11.09.2015
3 E/40363,40364/2013
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