COMMISSIONER OF CENTRAL EXCISE, VAPI Vs. CLEAR PET.

JUDGEMENT

(1.) THE Revenue is challenging the order of Commissioner (Appeals) No. KRS/26/Vapi/2007, dated 12 -7 -2007, wherein he has set aside the penalty imposed and confirmed demand of duty with interest. The facts of the case, in brief, are that the appellant procured goods from a 100% EOU on payment of duty of Rs. 2,92,920/ - and availed Cenvat credit thereon. The Consignor -unit was required to pay at 19.6% in terms of sub -rule (6)(a)(i) of Rule 3 of Cenvat Credit Rules, 2002 and as per the formula, the appellants were entitled to a credit of only 9.6% equivalent to Rs. 1,17,168/ - and Rs. 708/ - towards Education Cess whereas the appellants had taken credit on the full duty paid.

(2.) NO one has appeared on behalf of the respondent. Learned Jt. CDR supported the OIO.

(3.) I agree with the observations of Commissioner (Appeals) that sub -rule (2) of Rule 7 of erstwhile Cenvat Credit Rules, 2002 does not impose liability on the appellant to ensure the correctness of any exemption availed by consignors or correctness of the duty paid. What the consignee is required to do is to ensure that the supplier has paid the duty indicated in the invoice. The very fact that as soon as irregularity was noticed, the appellants reversed the credit, proves their bona fide and it is not the case of the department that supplies does not exist. Accordingly, the appeal filed by the Department is rejected.