2009 (2) TMI 604 - AT - Central Excise

Summary

Issues:
1. Confiscation of excess stock of M.S. bars found during a surprise visit by Central Excise officers.
2. Imposition of penalty for non-accountal of finished goods in statutory records.
3. Dispute over the imposition of redemption fine and penalty after initial release order was set aside.

Analysis:
1. The case involved the confiscation of excess stock of M.S. bars found during a surprise visit by Central Excise officers at the appellant's factory. The Assistant Commissioner initially ordered the release of the goods but later, upon review, the Commissioner (Appeals) remanded the matter for fresh decision on confiscation. Subsequently, the Assistant Commissioner re-adjudicated the matter and ordered confiscation of the seized goods, imposing a redemption fine and penalty on the appellant. The CCE (Appeals) dismissed the appeal against this order, leading to the present appeal before the CESTAT, New Delhi.

2. The appellant's representative argued that since the goods were unconditionally released by the Assistant Commissioner in the initial order, no redemption fine could be imposed during de novo adjudication. He relied on a judgment from the Punjab and Haryana High Court to support this argument. On the other hand, the Departmental Representative contended that the Assistant Commissioner's initial release order was set aside by the Commissioner (Appeals), justifying the imposition of the redemption fine as per the Supreme Court judgment in Weston Components Ltd. v. CC, New Delhi.

3. After considering the submissions from both sides and examining the records, the Tribunal acknowledged the non-accountal of 10 M.T. of M.S. Bars in the statutory register, constituting a contravention of Rule 10 of the Central Excise Rules. The key dispute revolved around the validity of the redemption fine and penalty following the initial release order. The Tribunal held that since the initial release order was set aside, the Supreme Court's judgment in Weston Components Ltd. applied, allowing for the confiscation of goods and the imposition of the redemption fine. However, considering the duty involved and the circumstances, the Tribunal reduced the redemption fine to Rs. 10,000 and the penalty to Rs. 5,000, modifying the impugned order accordingly.