2007 (3) TMI 114 - AT - Central Excise

Confiscation, interest and penalty - Revenue contended that appellant is engaged in confiscation of good and accordingly demand were made alongwith interest and penalty - Held that revenue contention not supported by any evidence hence revenue contention is rejected

Summary

Issues:
1. Seizure of grey fabrics without Central Excise documents
2. Proceedings initiated for demand of duty, confiscation of goods, and imposition of penalty
3. Allegations of clandestine removal and lack of reject register maintenance
4. Lack of evidence supporting charge of clandestine removal

Analysis:
1. The Central Excise Officers seized bales of grey fabrics from the transporter's godown without Central Excise documents, suspecting duty evasion. Statements from company representatives indicated the goods were part of cleared lots returned due to defects.

2. Proceedings were initiated against the appellants for demanding duty payment, confiscating goods, and imposing penalties. The order-in-original by the adjudicating authority was confirmed by the Commissioner (Appeals), leading to the current appeal.

3. The appellants maintained that the seized bales were rejects returned by customers, stored in the transporter's godown due to space constraints. The absence of a reject register was cited by authorities to reject this claim. However, the small lengths and varying numbers of pieces supported the appellants' explanation. The lack of evidence for clandestine removal further weakened the revenue's case.

4. The Tribunal found the goods were not meant for clandestine removal, given their storage duration and lack of evidence supporting the allegations. The absence of statutory register maintenance for rejects in this context was deemed unnecessary. Consequently, the impugned orders were set aside, and both appeals were allowed, providing relief to the appellants.