1985 (12) TMI 155 - AT - Central Excise

Summary

Issues:
1. Demand of duty and penalties under various rules on M/s. Steel Industries Kerala Ltd.
2. Alleged violations in clearances under Annexures A to G.
3. Applicability of Notification No. 118/75 to goods moved between units of the manufacturer.
4. Evidence of fabrication and duty liability for goods under Annexure 'D'.
5. Penalty imposition for alleged violations under different annexures.

Analysis:
1. The judgment pertains to a case where the Addl. Collector of Central Excise, Cochin, demanded duty and imposed penalties on M/s. Steel Industries Kerala Ltd. for alleged clearances without payment of proper duty. Penalties were imposed under Rule 9(2), Rule 52A(5), Rule 173Q, and Rule 226 of the Central Excise Rules, 1944.

2. The proceedings involved allegations related to clearances under Annexures A to G. Charges included removal of goods without following prescribed procedures, absence of gate pass, and discrepancies in duty payments. The appellants argued for exemption under Notification No. 118/75 for certain clearances.

3. The central issue revolved around the applicability of Notification No. 118/75 to goods moved between the manufacturer's units. The Tribunal examined licensing documents for the structural and foundry units, concluding that the foundry unit was not a 'factory' under the Act during the relevant period, thus not eligible for the notification's benefits.

4. Concerning goods under Annexure 'D,' the Collector doubted the claim of purchase as scrap from Cochin Shipyard and fabrication status. The Tribunal noted the absence of evidence of actual fabrication and granted the benefit of doubt to the appellant, setting aside the duty demand for these goods.

5. The Tribunal modified penalties imposed under various rules for different annexures. Penalties were reduced for certain violations, citing carelessness without mala fide intent. The judgment upheld duty demands for most annexures but set aside penalties under Rule 226 in full.

This comprehensive analysis outlines the key issues addressed in the judgment, including duty demands, alleged violations, applicability of notifications, evidence evaluation, and penalty imposition, providing a detailed insight into the legal complexities and findings of the case.