2004 (6) TMI 140 - AT - Central Excise

Summary

Issues:
- Duty demand and confiscation of excisable goods
- Penalties imposed on the appellants
- Appeal against Order-in-Appeal No. 584-588/2003
- Confiscation of excess processed and gray fabrics
- Redemption fine and penalties imposed on the appellants

Duty Demand and Confiscation of Excisable Goods:
The case involved appeals against the confirmation of duty demand and confiscation of excisable goods found in excess. The appellants, a company and its director, were found to have not accounted for a specific quantity of gray fabrics. Despite the appellants' arguments, the tribunal upheld the duty demand as the goods were removed without proper records or duty payment. While the entire duty amount had been deposited before the show cause notice, penalties under Section 11AC of the Central Excise Act were deemed applicable. The tribunal reduced the penalties imposed on both appellants, considering the circumstances.

Penalties Imposed on the Appellants:
Penalties were imposed on both appellants for the evasion of duty and improper accounting of excisable goods. The tribunal considered the statements provided by the company's representatives, noting discrepancies in the records and lack of proper entries. While the intention to evade duty was evident, the tribunal reduced the penalties from the maximum amount, taking into account the early deposit of the duty amount. The penalties were upheld but adjusted to Rs. 50,000 for Appellant No. 1 and Rs. 5,000 for Appellant No. 2.

Appeal Against Order-in-Appeal No. 584-588/2003:
The appeals were filed against a common Order-in-Appeal confirming duty demand, confiscation of goods, and penalties. The tribunal reviewed the submissions from both sides, emphasizing the discrepancies in the records and the lack of proper accounting for the received fabrics. The tribunal upheld the findings of the Commissioner (Appeals) regarding the duty demand and penalties, with adjustments made to the penalty amounts considering the early deposit of the duty.

Confiscation of Excess Processed and Gray Fabrics:
The case involved the detection of excess processed and gray fabrics during a visit to the factory premises. The Assistant Commissioner had confiscated the seized fabrics due to discrepancies in accounting and imposed penalties on both appellants. The tribunal rejected the argument that the excess quantity was still to be entered in the records, as the physical stock check revealed discrepancies acknowledged by the company's representative. The fabrics found in excess were deemed liable for confiscation, and penalties were upheld, albeit with reductions in the redemption fine and penalty amounts.

Redemption Fine and Penalties Imposed on the Appellants:
The tribunal addressed the redemption fine and penalties imposed on the appellants in relation to the excess fabrics found during the factory visit. Despite arguments about accounting errors, the tribunal upheld the confiscation of the excess fabrics due to unsatisfactory accounting practices. The redemption fine and penalties were adjusted, with the tribunal reducing the amounts imposed on Appellant No. 1 and setting aside the penalty imposed on Appellant No. 2 due to lack of evidence linking him to the accounting discrepancies. All appeals were disposed of with the adjusted penalties and confiscation upheld.