Reversal of cenvat credit

Question not clear.

If Cenvat credit of excise duty is taken already can it be reversed. If reversed then is there any penalty on it..

Yes it can be reversed. There is no penalty for this. If it is reversed on account of wrong availment of CENVAT Credit then interest will be charged. If this is reversed on account of As such Sale or Purchase return, then no interest will be charged.

Let's an example.. company A ordered excisable material from company B. While supplying the material company B has to submit DFT copy along with material sent. Company A excise team identified some error in DFT copy so the company returned the DFT copy for necessary correction. Company A didn't received rectified DFT copy. So the company A mailed to company B stating excise Amt will not be payable to u as we didint availed the credit of it. In this case what company B should do..

You can reverse CENVAT credit with a proper note and if this CENVAT is unutilised then no interest will be paid.