1. In this appeal filed by the party, the issue, broadly speaking, is whether under Rule 15 of the CENVAT Credit Rules, 2004 (CCR, 2004, for short), a penalty is liable to be imposed on the appellant on the facts of this case. The undisputed facts of this case are: (a) that the appellant was a registered Central Excise dealer during the material period and was, in that capacity, entitled to issue invoices for CENVAT credit purposes; (b) that the appellant had received materials (HRC plates etc.) from M/s. Steel Authority of India Ltd. and M/s. Abhishek Steels (manufacturers) under cover of excise invoices; (c) that they issued their own invoices to M/s. Laxmi Constructions without supply of the materials specifically described in the said invoices; (d) that the materials specifically described in the said invoices issued by the registered dealer were supplied to M/s. Tubes & Allied Products; (e) that M/s. Laxmi Constructions took CENVAT credit of the duty mentioned in the said invoices; (f) that, on the ground of the appellant having issued "CENVATable" invoices without supply of materials to M/s. Laxmi Constructions, a show-cause notice was issued to the appellant for imposing penalty on them under Rule 15 of the CCR, 2004; (g) that this proposal was contested by the appellant; (h) that the adjudicating authority imposed a penalty of Rs. 1,01,326/- on the appellant under Rule 15 of the CCR, 2004 read with the proviso to section 11A(1) of the Central Excise Act on the ground of contravention of Rule 3 of the CCR, 2004; and (i) that this penalty was sustained by the Commissioner(Appeals).

2. The argument of the learned counsel for the appellant is that Rule 15 is not applicable to the facts of this case. In this connection, he has elaborately referred to various sub-rules of Rule 15. At best, the Department could have invoked Rule 26 of the Central Excise Rules, 2002, but not even a corrigendum was issued by them to correct the error. It is argued that, at this stage, the above error is incorrigible. The learned counsel finally prays for setting aside of the penalty. The argument of the learned Additional Commissioner (AR) is that the invocation of wrong provision of law is a legal error which can be rectified at any stage. In this connection, he claims support from Vee Kay Enterprises v. CCE 2011 (266) ELT 436 (Punj. & Har.).

3. I have given careful consideration to the submissions. At the outset, I may state that the case law cited by the learned Additional Commissioner (AR) is not apposite to the present context inasmuch as, in that case, the relevant issue was whether a penalty under Rule 25 could be imposed on a dealer by invoking the ingredients of Rule 26 of the Central Excise Rules. On the facts of that case, the Hon'ble High Court found that both Rule 25(1)(d) and Rule 26(1) were applicable.

4. In the instant case, the controversy is around applicability of Rule 15 of the CCR, 2004 or Rule 26 of the Central Excise Rules, 2002. As it is not in dispute that the appellant issued "CENVATable" invoices to M/s. Laxmi Constructions without supply of the materials specifically described in such invoices, their conduct would attract sub-rule (2) of Rule 26 of the Central Excise Rules, 2002. This provision had come into force w.e.f. 01/03/2007 (The above offence was committed by the appellant in April 2007. The Department could very well have invoked Rule 26(2) to penalize the offender. However, they chose Rule 15 of the CCR, 2004. It also needs to be mentioned that the party, in their reply to the show-cause notice, did not claim inapplicability of Rule 15 and, in such circumstances, it did not occur to the Department that a corrigendum should be issued to correct the legal error. It appears, it was before the Commissioner (Appeals) that the party, for the first time, took the contention that Rule 15 ibid was not applicable. This contention is being reiterated before the Tribunal.

5. On the facts of this case, it cannot be gai