2004 (6) TMI 550 - AT - Central Excise

Summary

Issues:
1. Duty demand against M/s. Pace Marketing Specialities, penalty, and confiscation of goods.
2. Penalty imposed on the second appellant under Rule 209A.
3. Allegation of clandestine production and clearance of goods.

Analysis:

1. The first issue involves a duty demand exceeding Rs. one lakh against M/s. Pace Marketing Specialities, along with penalties and confiscation of goods. The central point of contention is the alleged clandestine production and clearance of goods from the appellant's factory. The appellant argues that the goods in question were removed after payment of duty under specific invoice numbers and were handed over to a transporter. The appellant asserts that there is no material to support the claim of clandestine production, highlighting that all details and particulars of duty payment were clearly indicated on the invoices.

2. The second issue pertains to the penalty of Rs. 5,000 imposed on the second appellant under Rule 209A. The appellant's counsel points out that there is no evidence on record to suggest that the consignment under seizure was different from the one cleared by M/s. Pace Marketing Specialities under specific invoices on the mentioned date. After reviewing the documents under seizure and hearing the arguments, the Tribunal concludes that the second duty demand is not sustainable, leading to the setting aside of the impugned order related to the appellants. Consequently, the penalties and redemption fines are deemed not maintainable.

3. The third issue revolves around the allegation of clandestine production and clearance of goods. The appellant's counsel highlights that the goods under seizure were not cleared from the appellant's factory but from a godown near Delhi, U.P. border in Sahibabad. The counsel argues that the goods in question were resold by the original buyer, which was lawful. The delivery note and bill of sale seized from the truck support the claim that the goods were resold to another entity. The Tribunal, after examining the records and considering the arguments presented, finds that the consignment in question was cleared on payment of duty by M/s. Pace Marketing Specialities. As a result, the duty demand and penalties imposed are deemed unjustified, leading to the allowance of both appeals and the directive to return the pre-deposits made by the appellants promptly.