1991 (8) TMI 207 - AT - Central Excise

Summary

Issues:
1. Imposition of penalty under Rule 173Q of the Central Excise Rules, 1944.
2. Quantum of penalty in case of personal penalty imposition.

Analysis:
1. The reference application was filed challenging the Tribunal's order regarding the imposition of a penalty under Rule 173Q of the Central Excise Rules, 1944. The Tribunal had found no clandestine removal of goods with an intent to evade duty, leading to a modification of the original order. The Tribunal set aside the confiscation of goods, quashed the demand of duty, and reduced the penalty from Rs. 25,000 to Rs. 20,000. The Tribunal observed that no duty was demandable from the applicant due to the absence of a valid gate pass for the seized goods in transit. The Tribunal differentiated between deliberate defiance of law and a lack of valid gate pass, indicating a penalty was warranted for the latter.

2. The appellant argued that the penalty imposition should be limited to a maximum of Rs. 1,000 under Rule 52A or Rule 210 of the Central Excise Rules, considering the Tribunal's findings. However, the Tribunal clarified that Rule 210 was not raised or discussed earlier, making it irrelevant to the current proceedings. The Tribunal also noted that the appellant's challenge to the seriousness of violations and the penalty awarded was an indirect challenge to the Tribunal's assessment and judgment, which is not the purpose of a reference application.

3. The Tribunal emphasized that intention is not a necessary element for penalties under Rule 173Q sub-rules (a), (b), and (c), except for sub-rule (d). The Tribunal found the appellant guilty of violating rules due to the absence of a valid gate pass for the seized goods in transit. However, the Tribunal granted the benefit of doubt to the appellants concerning machines and equipment seized from the factory, as there was insufficient evidence to prove mala fides. The matter regarding a tape recorder was remanded for further consideration based on new information provided by the appellant.

4. Ultimately, the Tribunal rejected the reference application, stating that no legal issue necessitating a High Court reference arose from the Tribunal's order. The Tribunal clarified that a reference application cannot be used as a substitute for an appeal and that challenging the Tribunal's assessment and judgment through a reference application is not permissible. The appellant was advised to pursue other legal avenues if aggrieved by the Tribunal's order.