Duty paid thru cenvat credit

This query is : Resolved

SATYA NARAYAN AGARWAL (Querist)
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24 January 2013 We are manufacturing fertiliser as well as Sulpuric Acid. We are paying duty @1% on fertiliser and no input credit is being availed On input for mfg. of fertiliser as per notification no 01/2011 dt 01.03.11.

However payment of 1% duty made from cenvat credit instead of cash as required under rule 3(4) cenvat credit rules 2004.

When noticed we started payment in cash from oct’2012 onwards.

Now the commissioner issued shocause notice mentioning that payment is illegal and liable for interest and penalty.

Kindly advise.

CA Chandra Kishore Bajpai

CA Chandra Kishore Bajpai (Expert)
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24 January 2013 whether you have already reversed the cenvat credit which was utilised for the payment prior to Oct'12, if not firs reverse it , intt would be payable but penalty can be waived if cenvat reversed & duty paid along with Intt