1990 (3) TMI 378 - AT - Central Excise

Summary

Issues Involved: Appeal against Order-in-Appeal rejecting challenge to penalty and duty imposition on Brass Controllers and Tops for L.P. Gas Stoves.

Details of the Judgment:

Issue 1: Jurisdictional Error in Adjudication
The appellant contended that the Deputy Collector exceeded the scope of the Show Cause Notice by adjudicating on both Unit No. 1 and Unit No. 2, despite the notice only mentioning Unit No. 2. The Collector upheld the decision, stating that Unit No. 1 was also mentioned in the notice. The appellant argued that a specific charge was required, and the department failed to prove clandestine removal of goods. The Tribunal found that the duty demand was not sustainable due to lack of evidence of clandestine production, citing relevant case law.

Issue 2: Alleged Contraventions and Defence Pleas
The respondent argued that the Show Cause Notice was valid, covering the contraventions and exemption issues. The appellant's defence plea regarding shortages and goods movement was considered new and not accepted. The Tribunal noted discrepancies in descriptions but found the evidence insufficient to establish manufacture in Unit No. 1. The Deputy Collector's rejection of the benefit of doubt was deemed against adjudication principles.

Issue 3: Duty Imposition and Penalty Justification
The Collector upheld the duty demand on Brass Controllers and Tops, citing lack of permission for bringing in excisable goods. The penalty of Rs. 2,000 was deemed justified for removal of LPG Stoves without duty payment, later paid. The Tribunal found no direct evidence of manufacture in Unit No. 1 and supported the imposition of penalty but ruled duty not leviable due to lack of proof of manufacture by the appellants.

The Tribunal concluded that while the penalty was justified for the removal of LPG Stoves without duty payment, the duty demand on Brass Controllers and Tops was not sustainable due to insufficient evidence of manufacture by the appellants. The appeal was disposed of accordingly, upholding the penalty but rejecting the duty imposition.