2005 (6) TMI 373 - AT - Central Excise

Summary

Issues:
1. Duty not debited for goods found outside the factory.
2. Demand for defective goods not found in the factory.
3. Demand for goods not entered in statutory record.
4. Seized goods not entered in statutory record.

Analysis:

Issue 1:
The appellant did not contest the duty demand for goods found outside the factory but challenged the penalty imposed. The Revenue argued that duty should have been debited for goods loaded in the tempo. The penalty was upheld.

Issue 2:
Regarding defective goods not found in the factory, the appellant provided evidence of rectification and clearance under invoices. The Revenue did not claim the processes amounted to manufacture. As the goods were cleared after rectification, the duty was not payable again, and the appellant was entitled to credit for duty already paid. The demand was set aside.

Issue 3:
For goods not entered in the statutory record based on inter-office memos, the appellant claimed the goods were reflected in the RG-I record. However, the dates did not match, and the demand was upheld as the goods were not entered in the record.

Issue 4:
Regarding excess goods found in the factory, the appellant argued they were to be inspected and then entered in the RG-I record. However, no inspection records were maintained. The plea was deemed without merit, and the excess goods were liable for confiscation.

In conclusion, the penalty was reduced to Rs. 1,00,000 under Section 11AC of the Central Excise Act, 1944. The appeal was disposed of with varying outcomes for each issue based on the evidence and arguments presented.