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1995 (9) TMI 377 - AT - Central Excise
Issues:
1. Seizure of goods for non-payment of appropriate duty. 2. Confiscation of goods and imposition of fines. 3. Liability of appellants for duty and penalty. 4. Validity of show cause notice and penalty imposition. Analysis: 1. The case involved the seizure of goods by the Assistant Collector of Central Excise due to non-payment of appropriate duty by the appellants. The goods were found to contain characteristics of polyester tow, leading to the confiscation of 180 bags containing 2850 kgs. of alleged polyester fibre tow. The appellants claimed the goods were uncut waste, but the examination revealed otherwise. 2. The Adjudicating Authority ordered the confiscation of 1789 kgs. of polyester tow with an option for redemption on payment of a fine of &8377; 40,000. Additionally, 1061 kgs. of polyester tow were also confiscated with a redemption fine of &8377; 20,000, duty payment, and a penalty of &8377; 5 lakhs imposed on the appellants. 3. The appellants contended that they were only purchasers of the goods and not the manufacturers, therefore, they should not be liable to pay duty. They also argued that the penalty imposed was not sustainable as the show cause notice did not mention any penal action against them. The Department, on the other hand, maintained that the goods were indeed polyester fibre tow and duty was rightly demanded from the appellants for their involvement with the manufacturer. 4. The Tribunal considered the submissions and found that while confiscation of the goods was justified due to their nature, the appellants, being purchasers and not manufacturers, were not liable to pay duty. The penalty imposed was deemed unsustainable as the show cause notice did not propose any penal action. The redemption fine was reduced to &8377; 30,000 based on the appellants' claim of purchase price. The impugned order was modified accordingly, and the appeal was disposed of in favor of the appellants with the above adjustments.
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