2009 (3) TMI 723 - AT - Central Excise

Summary

Issues:
1. Imposition of redemption fine and duty liability with penalty.
2. Consideration of remission application for duty amount.
3. Confiscation of goods and payment of redemption fine.
4. Relief sought due to goods destroyed by fire.
5. Granting appropriate relief for duty if relatable to goods destroyed in fire.
6. Imposition of penalty in case of goods lost by fire.

Analysis:
The appeal before the Appellate Tribunal CESTAT, New Delhi involved the imposition of a redemption fine of Rs. 25,000, duty liability of Rs. 34,817, and an equal amount of penalty. The appellant's counsel argued that due to a short circuit causing a fire and subsequent destruction of goods, the redemption fine and penalty should be waived, while the duty would be paid upon removal of the goods. The learned DR opposed this prayer, supporting the adjudicating authority's order.

Upon hearing both sides and examining the record, it was noted that the remission application was related to the duty amount of Rs. 34,817, and the goods were confiscated as per the order-in-original. The appellant had redeemed the goods claimed to be destroyed by fire and had paid the redemption fine and duty with penalty. The Commissioner held that there would be no remission of duty on confiscated goods but considered the remission application infructuous as it was for goods destroyed by fire on which duty had already been paid. The Tribunal emphasized that if the duty was payable on the goods lost in the fire, appropriate relief should be granted. The imposition of penalty was questioned, stating that if the fire was the reason for the loss and supported by the Fire Brigade report, no penalty should be levied.

In the final decision, the appellant was granted relief only in terms of the penalty imposed, with no relief for the redemption fine. The matter of excise duty relating to the goods destroyed by fire was to be reconsidered by the Commissioner to grant appropriate relief, with a fair opportunity for hearing. The appeal was partly allowed and remitted for further consideration by the Commissioner.