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2007 (3) TMI 91 - AT - Central ExciseTwo cases alleged on appellant (i) payment of duty at concessional rate after crossing exemption limit (ii) confiscation of raw material and the semi-finished good - Held that the allegation were not sustained
Issues:
1. Confirmation of duty demand and imposition of personal penalty under Rule 25 of the Central Excise Rules, 2002. 2. Applicability of penalty under Section 11AC in light of duty deposit before show cause notice issuance. 3. Clearance of goods exceeding the exemption limit and imposition of penalty. 4. Confiscation of raw material and semi-finished goods due to non-maintenance of records. Issue 1: The appellate tribunal upheld the confirmation of duty demand of Rs. 41,799 and the imposition of a personal penalty of the same amount under Rule 25 of the Central Excise Rules, 2002. The excess raw material and semi-finished goods found were confiscated with an option for redemption upon payment of a fine. Issue 2: The tribunal noted that the duty amount was deposited before the issuance of a show cause notice. Citing a Mumbai High Court decision, it held that no penalty could be imposed under Section 11AC in such circumstances. The penalty imposed on the appellants was set aside based on this reasoning. Issue 3: Despite the appellants exceeding the clearance value for the exemption and continuing to clear goods at a concessional rate of duty, the tribunal found no mala fide intention. It was observed that all clearances were recorded, indicating no intent to evade duty. The penalty imposed on the appellants for this issue was overturned. Issue 4: Regarding the confiscation of raw material and semi-finished goods due to non-maintenance of records, the tribunal found no evidence of intent to clear goods without payment of duty. The confiscation was set aside, but a nominal penalty of Rs. 2,000 was imposed for the failure to maintain records in accordance with Central Excise provisions. The appeals were allowed, except for the penalty related to record-keeping.
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