2002 (12) TMI 112 - AT - Central Excise

Summary

Issues:
1. Appeal against Order-in-Appeal No. 217/2000 (H-I) CE, dtd. 21-11-2000.
2. Discrepancies in stock of Calcium Carbonate and other materials.
3. Invocation of Rule 173Q for penalty imposition.
4. Contention regarding excess stock of raw material and duty liability.

Analysis:
1. The appeal was filed against Order-in-Appeal No. 217/2000 (H-I) CE, dated 21-11-2000, passed by the Commissioner of Customs & C. Excise (Appeals), Hyderabad. Despite the absence of the party during the final hearing, the Tribunal proceeded to address the issues raised. The Deputy Commissioner had confiscated excess stock of Calcium Carbonate and imposed penalties under Rule 173Q, which was contested by the appellants.

2. The impugned order highlighted discrepancies in stock, including excess Calcium Carbonate and shortages of finished goods and raw materials. The Deputy Commissioner justified the confiscation under Rule 226, citing non-accountal of excess stock and shortages. However, the Tribunal found that Calcium Carbonate was non-dutiable and not liable for confiscation, reducing the redemption fine and penalty imposed based on this item. The Tribunal upheld penalties for shortages of other inputs but reduced the fines imposed.

3. Rule 173Q was invoked for imposing penalties due to excess stock and removal of goods without payment. The Tribunal acknowledged the importance of maintaining statutory records under Central Excise law and upheld penalties for shortages of finished goods and raw materials. The Tribunal differentiated between dutiable and non-dutiable items in determining the quantum of fines and penalties to be imposed.

4. The party contended that the excess stock of Calcium Carbonate was duly entered in their accounts and not subject to duty or confiscation. They argued against the imposition of penalties on Calcium Carbonate, emphasizing its non-dutiable nature. The Tribunal agreed with this contention, reducing fines and penalties related to Calcium Carbonate while upholding penalties for shortages of other materials. The Tribunal's decision focused on the specific nature of the items involved and the applicability of penalties based on dutiability and confiscation criteria.