1. The facts of the case in brief that the respondents are engaged in the manufacture of sponge iron classifiable under chapter 72 of first schedule to the Central Excise Tariff Act, 1985. The respondent availed Cenvat Credit of Rs. 10,44,367/- on various iron and steel items such as channels, angles, beams, joist, S.S. plate, M.S. plate, welding electrode, H.R. sheets, Screen cloth and H.R. coil etc. during the period January 2003, September 2005, October 2005, November 2005 to March 2006, April 2006 to November 2006 and April 2007 to July 2007 respectively treating the same as inputs which were used for the manufacture of capital goods. Show Cause Notice was issued. The adjudicating authority disallowed the entire Cenvat Credit of Rs. 10,44,367/- and demanded interest and imposed penalty equal to the amount of Cenvat Credit under Rule 15 of Cenvat Credit Rules, 2004 read with section 11AC of the Central Excise Act, 1944. On appeal the Commissioner (Appeals) upheld the recovery of Cenvat Credit along with interest, but waived the penalty imposed. Hence the present appeal by the Revenue.
2. Ld. A.R. appearing on behalf of the Revenue reiterates the grounds of appeal.
3. The ld. Advocate appearing on behalf of the respondent argued the matter at length and submits that the entire amount of Cenvat Credit denied along with interest has been paid by the assessee. He vehemently argues that no penalty is imposable. He further submits that since there were conflicting decisions on the issue, the appellants cannot be held responsible for suppression of facts with intent to evade payment of duty. In support of his submissions he relied on the following decisions:-
(a) Eastern Metallizing Ltd. v. Commissioner of C. Ex., Kolkata-II [2016 (340) E.L.T. 384 (Tri.-Kolkata)]
(b) BNK Parts Pvt. Ltd. v. Commissioner of C. Ex., Chennai-II [2002 (145) E.L.T. 191 (Tri.-Chennai)]
4. Heard both sides and perused the appeal records.
5. I find that the credit was taken by the respondent assessee with respect to channels, angles, beams, joist, S.S. plate, M.S. plate, welding electrode, H.R. sheets, Screen cloth and H.R. coil etc. during the period January 2003, September 2005, October 2005, November 2005 to March 2006, April 2006 to November 2006 and April 2007 to July 2007 respectively treating the same as inputs which were used for the manufacture of capital goods. In my considered view, it is a case of interpretation of the provisions and there was no allegation of any suppression on any facts from the department. Similar issue has been dealt with by various Co-ordinate Benches of the Tribunal on interpretation of the Statute and it was held that where there was difference of opinion between the assessee and the department on interpretation, no penalty can be imposed.
6. As it would appear from the facts of the case that the ingredients required for invoking Section 11AC is not present in the case of the respondent.
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>In view of the above discussions, I find that the impugned order has examined the issues in detail and had arrived at sustainable conclusion in line with the ratio adopted by the Hon'ble Supreme Court, various High Courts and this Tribunal also. Accordingly, I find no reason to interfere with the impugned order. The appeal is rejected.