2004 (1) TMI 131 - AT - Central Excise

Summary

Issues: Challenge to correctness of order-in-appeal regarding remission of duty, confiscation of unaccounted goods, and penalty imposition.

Analysis:
1. The Revenue appealed against the order-in-appeal that reversed the order-in-original concerning remission of duty, confiscation of unaccounted goods, and penalty imposition. The Revenue argued that the admission by the company's Director regarding non-accountal and removal of goods without duty payment should not have been ignored by the Commissioner (Appeals). The Revenue contended that the impugned order should be set aside due to this admission.

2. The company's counsel, on the other hand, argued that besides the Director's statement, there was no other evidence proving the non-accountal and clandestine removal of goods. The counsel also claimed that the redemption fine and penalty imposed were excessive. After hearing both sides and reviewing the records, it was revealed that during a visit to the factory premises, excess non-alloy steel ingots were found without proper accountal, involving Central Excise duty. The Director admitted to receiving scrap, manufacturing ingots, and removing them without paying duty, which was not accounted for.

3. The Tribunal noted that the Director's admission was substantial evidence supporting the charges in the show cause notice. The Commissioner (Appeals) erred in setting aside the confiscation of unaccounted goods and duty confirmed for clandestine manufacture and removal, citing procedural issues during physical verification. The Tribunal emphasized that the Director's admission, being within his special knowledge, was binding on the company. Therefore, the Commissioner's order was legally unsustainable and set aside, restoring the order-in-original. The plea for reducing the redemption fine and penalty was rejected due to the absence of cross-objections by the company, leading to the Revenue's appeal being allowed.