2012 (12) TMI 307 - AT - Central Excise

Confiscation of seized goods - confiscation of tractor - imposition of penalties - Appellant contended that shortages were on account of clearance of products without the cover of any documents - admitted clearance of 25000 Kgs. of final products without the cover of any document interception of the same statement of driver and Shri Rajendra Kumar Sharma clandestine clearance - held that - confirmation of demand of duty of Rs.4, 00, 087/- along with imposition of penalty of identical amount under Section 11 AC is required to be upheld - Lower authorities while imposing penalty to the extent of 100% of duty have not extended any option to the appellant to pay the entire dues along with 25% of penalty within a period of 30 days from the date of passing of order in which case penalty shall stand reduced to 25% in terms of proviso to Section 11AC. further in terms of Gujarat High Court decision in the case of CCE Surat I vs. Harish Silk Mills 2010 (2) TMI 494 - GUJARAT HIGH COURT such option can be given at the appellate stage - option to the appellant is extended and if they deposit entire dues along with 25% of penalty within a period of 30 days from the receipt of present order the penalty shall stand reduced to 25% - such option is now extended to appellant.

Summary

Issues:
1. Clearance of goods without Central Excise invoices.
2. Shortage of finished goods and non-payment of Central Excise duty.
3. Imposition of penalties and confiscation of goods.

Analysis:

Issue 1:
The appellant was engaged in the manufacture of MS wires and intercepted goods were cleared without Central Excise invoices, leading to a show cause notice for demand confirmation and penalties. The authorities found discrepancies in documents and confirmed the demands as proposed, imposing penalties on relevant individuals. The appellant's appeal against the order was unsuccessful before the Commissioner (Appeals).

Issue 2:
Upon physical examination, a shortage of finished goods was found, and the authorized signatory admitted to clearing goods without paying Central Excise duty. The appellant contended that acceptance of shortages did not prove clandestine removal, but the tribunal disagreed. Considering evidence like interception, statements, and admissions, the confirmation of demand and penalty under Section 11AC for non-payment of duty were upheld. However, the tribunal extended an option to pay dues and reduced the penalty to 25% in line with a Gujarat High Court decision.

Issue 3:
The tribunal upheld the confiscation of intercepted goods due to lack of documents and the admission of clearing goods without proper documentation. The redemption fine imposed was considered reasonable, and no interference was made. The overall appeal was disposed of with the above decisions pronounced in open court on 9.11.2012.