2001 (8) TMI 1133 - AT - Central Excise

Summary

Issues:
Challenge to order confirming demand and imposing penalty.

Analysis:
The appeal was filed by M/s. New Allenberry Works against the order of the ld. Commissioner of Central Excise confirming a demand of Rs. 1,57,200.30 and imposing a penalty of Rs. 2,00,000. The appellants, engaged in the manufacture of gear boxes, cleared 161 consignments under G.P.Is involving a total duty of Rs. 1,77,063.35. It was observed that they cleared excisable goods under G.P.Is without sufficient balance in their PLA Account. The appellants argued that they cleared goods as per customer requests for specific dates on documents, even though the actual clearance occurred when there was enough balance in their PLA. They contended that any shortages pointed out by the Department were rectified promptly, indicating no intent to evade duty payment. They requested the demand and penalty to be set aside, emphasizing that there was no duty evasion as there was sufficient balance in the PLA during actual clearance.

The Department, represented by the ld. DR, argued that duty paying documents indicated insufficient balance in the PLA at the time of their preparation, emphasizing that duty paying documents should only be prepared at the time of goods clearance. They highlighted the lack of evidence from the appellants to prove the actual deposit of the confirmed duty amount. The Department supported the imposition of penalty for rule contraventions, asserting that the penalty was justified given the circumstances of the case.

The Tribunal noted the conflicting positions on the duty issue and ruled that if the appellants could provide evidence of duty payment, it should be adjusted against the confirmed demand. Regarding the penalty imposition, the Tribunal acknowledged rule violations and upheld the imposition of penalty. However, considering the appellants' argument that gate passes were prepared as per customer requests, with actual clearance occurring when there was sufficient balance in the PLA, the Tribunal reduced the penalty to Rs. 1,00,000. The appeal was disposed of with the modified penalty amount, taking into account all facts and circumstances of the case.