2001 (12) TMI 293 - AT - Central Excise

Summary

Issues:
1. Reduction of redemption fine and penalty amount by the Commissioner (Appeals).
2. Confiscation of goods and imposition of penalty on the appellants.
3. Dispute over non-accountal of goods in the RG-1 register.
4. Allegation of mala fide intention by the appellants.

Analysis:
1. The appeal was filed against the Commissioner (Appeals) order reducing the redemption fine on seized goods to Rs. 60,000 and penalty amount to Rs. 25,000. The Deputy Commissioner had initially imposed a fine of Rs. 1,20,000 on the appellants along with a penalty of Rs. 5 lakhs and Rs. 1,000 on a partner for excess goods found during verification. The Tribunal analyzed the facts and arguments presented by both sides.

2. The appellants were involved in manufacturing wire and cable for the Indian Railways. During a visit, excess goods were found, leading to confiscation and penalties. The appellant argued that the non-accountal of goods in the register was due to the Railways' non-inspection and not a mala fide intention. The Department contended that the appellants had the intention to evade duty. The Tribunal examined the circumstances and observed that the appellants had no mala fide intention to evade duty, especially since the goods were meant for the Railways and were inspected before supply.

3. The Tribunal noted that the goods were manufactured before being entered in the register, but this did not indicate mala fide intent. The appellants waited for inspection by the Railways before clearing the goods, demonstrating good faith. The Tribunal referenced a previous case to support its decision that the provisions for confiscation could not be invoked without evidence of mala fide intent. Ultimately, the Tribunal held that the goods could not be confiscated and imposed a penalty of Rs. 2,000 under Rule 226 for non-accountal of goods, modifying the impugned order.

4. In conclusion, the Tribunal set aside the Commissioner (Appeals) order regarding confiscation of goods and imposition of redemption fine and penalty under Rule 173Q. The appellants were penalized under Rule 226 for non-accountal of goods. The appeal was disposed of with the modification of the impugned order.