2004 (10) TMI 492 - AT - Central Excise

Summary

Issues: Appeal against order-in-original regarding confiscation of excess goods and reduction of penalties.

Analysis:

Issue 1: Proper physical verification of goods
The Counsel contended that the excess goods were determined on an average basis without proper physical counting. However, the Tribunal disagreed, citing the presence of the Director during the visit to the factory premises where he acknowledged the method used to calculate the excess goods. The Director even signed the panchnama without objection. Therefore, the Tribunal held that the contention of no excess goods and improper verification method by the Central Excise officers was not valid.

Issue 2: Disproportionate redemption fine and penalty
The Tribunal found merit in the Counsel's argument regarding the disproportionate nature of the redemption fine and penalties imposed in relation to the duty amount involved. While the duty on excess goods was Rs. 77,000, the redemption fine was set at Rs. 1,25,000, and the penalty at Rs. 50,000. Considering this disproportionality, the Tribunal reduced the redemption fine to Rs. 30,000 and the penalty to Rs. 20,000. However, the penalty on the Director (appellant No. 2) was maintained. The Tribunal modified the impugned order accordingly, taking into account the facts and circumstances of the case, and disposed of the appeals with the revised penalties.

In conclusion, the Tribunal upheld the order-in-original regarding the confiscation of excess goods but made adjustments to the penalties imposed, reducing the redemption fine and penalty due to their disproportionate nature compared to the duty amount involved. The Tribunal's decision aimed to strike a balance between enforcement measures and fairness in penalty imposition based on the specific circumstances of the case.