2006 (11) TMI 417 - AT - Central Excise

Summary

Issues involved: Appeal against confiscation and penalty u/s Rule 173Q for non-entry of produce in statutory record of production.

Summary:
The Appellate Tribunal CESTAT, Ahmedabad, heard the appeal and decided to proceed without pre-deposit. The impugned order upheld confiscation and penalty due to non-entry of produce in the statutory record of production. The appellant argued that the goods were not accounted for as they were not weighed before officers visited the factory, and emphasized that there was no intention to evade duty as all input quantities were recorded. The appellant also highlighted the unsatisfactory stock verification method used by officers, relying on a previous Tribunal decision to support the argument that penalty under Rule 173Q(1)(b) should not apply when excess material is found on-site. The SDR contended that the admitted excess material constituted a rule violation. The Tribunal found merit in the appellant's argument, noting that the finished products were present in the factory and raw materials were properly recorded, thus Rule 173Q did not apply. Citing the precedent of Orient Cerwool Ltd., the Tribunal set aside confiscation and penalty, allowing the appeal with any consequential relief for the appellant. The judgment was dictated and pronounced in open court.