2003 (1) TMI 606 - AT - Central Excise

Summary

Issues:
Confirmation of duty with penalty under Section 11AC, reduction of redemption fine, imposition of penalty under Rule 173Q, confiscation of plant and machinery, imposition of redemption fine on seized goods, contestation of penalties.

Confirmation of Duty with Penalty under Section 11AC:
The appeal was against the Order-in-Appeal confirming the duty with an equal penalty under Section 11AC, while reducing the redemption fine. The appellants admitted to sending goods without duty paying documents, leading to the duty demand of Rs. 64,363/-, which was not challenged. The Counsel argued against the penalty amount being equal to the duty, citing it as a mistake rather than wilful suppression. The Tribunal acknowledged the mistake but reduced the penalty to Rs. 25,000/- due to the lack of evidence of deliberate intent.

Reduction of Redemption Fine:
The Commissioner (Appeals) affirmed most of the original order but modified the redemption fine for plant and machinery and seized goods. The Tribunal found the reduction in the redemption fine for the seized goods to be fair, reducing it to Rs. 2500/- from Rs. 5000/-, as confirmed by the adjudicating authority.

Imposition of Penalty under Rule 173Q:
The adjudicating authority had imposed penalties under Rule 173Q, including confiscation of plant and machinery. However, the Tribunal noted that Rule 173Q allows confiscation only if the duty involved exceeds Rs. 1 lakh, while in this case, it was Rs. 64,363/-. Consequently, the Tribunal set aside the order for confiscation of plant and machinery.

Imposition of Redemption Fine on Seized Goods:
The imposition of redemption fine on the seized goods was not contested, as the goods were not duty paid. The Tribunal agreed that the reduction in the redemption fine for the seized goods by the Commissioner (Appeals) was appropriate, providing relief to the appellants.

Contestation of Penalties:
The Counsel raised concerns about the imposition of a penalty under Rule 173Q alongside the penalty under Section 11AC. The Tribunal rejected this argument, stating that both penalties were rightly imposed based on the circumstances and facts of the case. No other contentions were raised, and the impugned order was modified accordingly, disposing of the appeal.