1987 (12) TMI 212 - AT - Central Excise

Summary

Issues:
1. Transfer of revision application to the Tribunal for appeal consideration.
2. Alleged violation of Central Excise rules regarding removal of excisable goods.
3. Interpretation of Notification 125 of 1980 and its applicability.
4. Compliance with the Bombay Prohibition Act.
5. Defense arguments regarding the nature of the goods removed.
6. Decision on the appeal and rejection thereof.

Transfer of Revision Application to the Tribunal:
The revision application filed by the appellant against the order passed by the Central Board of Excise and Customs was statutorily transferred to the Tribunal for consideration as an appeal.

Alleged Violation of Central Excise Rules:
The case involved the verification of excisable goods bought by the appellants, leading to the discovery of excess and shortage of certain substances. The Central Excise authorities seized a specific quantity of alcohol and held the appellants liable for differential duty and imposed a penalty for sending goods outside their factory premises without authorization.

Interpretation of Notification 125 of 1980:
The appellants relied on Notification 125 of 1980 to justify the removal of goods for further processing outside the factory premises. However, the notification came into force after the goods were removed, rendering it inapplicable to the situation. The Tribunal noted that the notification allowed removal for necessary industrial processes, but the removal in question predated the notification.

Compliance with the Bombay Prohibition Act:
The appellants argued compliance with the Bombay Prohibition Act regarding the manufacture of denatured spirit. They contended that the goods sent outside the factory were essential raw materials for manufacturing pharmaceuticals and dyes, emphasizing their adherence to legal provisions.

Defense Arguments on Goods Nature:
The appellants claimed that the goods sent outside were not in violation of the rules as they were processed toluene, not raw toluene. However, the Tribunal rejected this argument, stating that processed toluene still falls under the purview of the rules governing excisable goods.

Decision on the Appeal:
The Tribunal considered the submissions and arguments presented by both parties. It concluded that the appellants had admitted to the unauthorized removal of goods, which violated the Central Excise rules. The Tribunal emphasized that compliance with one law does not justify breaching another. As the removal occurred before the relevant notification came into effect, the Tribunal rejected the appeal, upholding the decision of the Central Board of Excise and Customs.