2002 (5) TMI 815 - AT - Central Excise

Summary

Issues:
1. Confiscation of seized goods with redemption fine.
2. Confirmation of duty on goods covered by invoices.
3. Confirmation of duty on goods found short.
4. Imposition of personal penalties on the appellants and another party.
5. Appeal against penalties imposed.

Analysis:
1. The officers found discrepancies in the invoices issued by the appellants to M/s. Ambika Traders, leading to the seizure of goods and verification of stock. The Assistant Commissioner's order included confiscation of seized goods with a redemption fine, confirmation of duty on goods covered by the invoices, and imposition of personal penalties on the appellants and the other party. The appellants contested the show-cause notice, leading to an appeal.

2. During the appeal, the appellants argued that the invoices were issued in haste, leading to the omission of necessary duty payment entries. The counsel highlighted that there was no intent to evade duty, as all statutory records reflected the goods' removal. The discrepancies in cotton and polyester yarn stock were attributed to misreporting by laborers. The jurisdictional Assistant Commissioner's penalties were contested based on the absence of mala fides.

3. The Tribunal considered the submissions and acknowledged the undisputed lapse of not making duty payment entries on time. The appellants admitted the delay in making necessary entries, resulting in the goods being in a non-duty paid status until the entries were made. The Tribunal found the penalty imposed under Rule 173Q to be high and exorbitant, citing a precedent where a similar penalty was reduced significantly. Consequently, the penalty on the appellants was reduced from Rs. 1.2 lakhs to Rs. 10,000. The redemption fine, directly related to confiscation and penalty, was also reduced proportionately from Rs. 50,000 to Rs. 5,000.

4. In conclusion, the Tribunal allowed the appeal to the extent of reducing the penalties imposed on the appellants. The decision emphasized the need for timely duty payment entries and recognized the need for proportionate penalties in such cases. The reduction in penalties aimed to align with previous judgments to ensure fairness and reasonableness in penalty imposition.