2004 (8) TMI 310 - AT - Central Excise

Summary

Issues Involved:
1. Confiscation of goods from M/s. Trilux Electric Pvt. Ltd.
2. Penalty on M/s. Devi Wires and Filaments.
3. Penalty on Shri N.P. Choubey.

Issue-wise Detailed Analysis:

1. Confiscation of goods from M/s. Trilux Electric Pvt. Ltd.:
M/s. Trilux Electric Pvt. Ltd. argued that the goods were confiscated without serving a notice on the company, as the notice was only served to the Director, Mr. Padmanabhan. The Commissioner justified the confiscation by stating that the Director's notice sufficed for the company. However, the Tribunal found that the show cause notice was neither addressed to nor served on M/s. Trilux Electric Pvt. Ltd., which is a mandatory requirement under Section 124 of the Customs Act for confiscation. The Tribunal concluded that the confiscation of the goods from M/s. Trilux Electric Pvt. Ltd. was contrary to the provisions of the Customs Act and set aside the order of confiscation and the penalty imposed on the company.

2. Penalty on M/s. Devi Wires and Filaments:
M/s. Devi Wires and Filaments, a proprietary concern of Shri J.B. Poojari, contended that no specific show cause notice was issued to the firm, only to the proprietor. The Tribunal held that a notice to the proprietor is effectively a notice to the firm. The Commissioner had confiscated the machines seized from the appellant's premises and imposed a penalty, stating that the appellant had taken reasonable steps to ensure the goods were not smuggled but failed to pursue further verification. The Tribunal found the penalty imposed to be high and reduced it from Rs. 50,000/- to Rs. 10,000/-, while upholding the confiscation and redemption fine.

3. Penalty on Shri N.P. Choubey:
Shri N.P. Choubey was penalized for aiding and abetting the removal of machinery from a 100% E.O.U. in violation of Customs Act provisions. He argued that the penalty was based on statements of co-accused without material evidence and that he was not involved post-resignation. The Tribunal noted that despite several opportunities, Shri Choubey did not attend personal hearings or submit a final reply. The Commissioner's findings, supported by statements and documentary evidence, indicated Shri Choubey's involvement in the clandestine removal of machinery. The Tribunal found the penalty of Rs. 1 Crore to be excessive and reduced it to Rs. 40,00,000/- while upholding the charge against him.

Conclusion:
The Tribunal set aside the confiscation and penalty on M/s. Trilux Electric Pvt. Ltd. due to procedural lapses, reduced the penalty on M/s. Devi Wires and Filaments considering the circumstances, and reduced the penalty on Shri N.P. Choubey while upholding the charges against him.