2002 (4) TMI 757 - AT - Central Excise

Summary

Issues:
1. Central Excise duty on excess goods found during verification.
2. Confiscation of excess goods under Rule 173Q.
3. Appeal against the order of confiscation and penalties.
4. Exemption from duty based on clearances made by the appellants.
5. Lack of findings by the adjudicating authority on submissions made by the party.

Central Excise Duty on Excess Goods:
The appellants, engaged in manufacturing Plywood, Block Board, and Flush Doors, were found to have excess finished goods valued at Rs. 2,93,100/- during a physical verification by Central Excise Officers. This excess stock attracted Central Excise duty of Rs. 46,896/-, leading to initiation of proceedings against the appellants resulting in an order for confiscation under Rule 173Q of the Central Excise Rules, 1944. The Deputy Commissioner allowed redemption of goods on payment of a fine of Rs. 30,000/- and imposed a penalty of Rs. 20,000/-.

Confiscation of Excess Goods under Rule 173Q:
The Deputy Commissioner's order for confiscation of the excess goods valued at Rs. 2,93,100/- under Rule 173Q was challenged in an appeal. The Commissioner (Appeals) in New Delhi upheld the confiscation but reduced the redemption fine to Rs. 20,000/- and the penalty to Rs. 10,000/-.

Appeal Against Order of Confiscation and Penalties:
The appeal against the Commissioner (Appeals) order was heard, where the appellants argued that their clearances were below the exemption limit of Rs. 1 crore for Central Excise duty payment based on specific notifications. They contended that the excess stock was due to a clerical mistake and not an attempt to evade duty. The Tribunal observed that the original authority failed to provide findings on these crucial submissions, leading to a remand of the matter for fresh adjudication.

Exemption from Duty Based on Clearances:
The appellants claimed exemption from Central Excise duty based on the value of clearances made by them during the financial year, asserting that even with the additional value of excess goods, their total clearances remained below the exemption limit. This argument was pivotal in their appeal against the confiscation and penalties imposed.

Lack of Findings by the Adjudicating Authority:
The Tribunal noted the absence of specific findings by the original authority on the submissions made by the appellants regarding their clearances, exemption eligibility, and the clerical error leading to excess stock. Due to this deficiency, the Tribunal set aside the impugned order and remanded the matter to the original authority for a fresh adjudication, emphasizing the need for a proper consideration of the facts and a clear recording of findings.

This detailed analysis of the judgment highlights the key issues involved in the case and the Tribunal's decision to remand the matter for further consideration, emphasizing the importance of providing thorough findings in such legal proceedings.