2006 (12) TMI 312 - AT - Central Excise

Summary

Issues involved: Violations related to non-accounting of finished goods, non-debiting of duty amount, and ineligible credit availed by the company and its employees.

Violation of non-accounting of finished goods: The company's factory was visited by Central Excise Officers who found finished goods unaccounted for outside the bonded store room. The company defended this by citing lack of storage space, but authorities confiscated the goods and upheld the demand, leading to penalties.

Non-debiting of duty amount: The company failed to debit 10% duty while dispatching inputs to job workers. The authorities confirmed the demand on this issue, which the company contested, arguing that penalties were imposed without invoking specific clauses of the Central Excise Rules.

Ineligible credit availed: The company took credit in P.L.A. for excess amounts paid on clearances, leading to penalties. The company and its employees contested these penalties, claiming lack of knowledge about Central Excise Law.

Judgment: The Appellate Tribunal upheld the demand for certain duty amounts already paid by the company. However, it set aside the demand for goods still in the factory premises and reduced the redemption fine. Confiscation of land, building, and machinery was overturned as the company was not deemed a habitual offender. Penalties imposed on the company under Rule 173Q were set aside following a Supreme Court precedent. Personal penalties on employees under Rule 209A were also revoked due to lack of evidence of their knowledge of the violations. The impugned order was modified accordingly.