1993 (1) TMI 179 - AT - Central Excise

Summary

Issues:
1. Duty demand on shortages and excess of motor vehicle parts.
2. Imposition of penalty and confiscation of excess goods.
3. Validity of reconciliation statement and verification by the Superintendent.
4. Interpretation of Rule 173Q regarding excess goods in the store room.
5. Justification for duty demand on admitted shortages.
6. Consideration of penalty and redemption fine for excess goods.

Analysis:
1. The case involves a duty demand on shortages and excess of motor vehicle parts discovered during a stock verification. The Assistant Collector confirmed the duty demand for shortages and imposed a penalty, which was later reduced on appeal before the Collector (Appeals). The appellant challenged the order before the Tribunal.

2. The appellant's consultant argued that the variations in stock could be due to accounting errors, given the large turnover of the unit. He contended that a reconciliation statement was submitted, but the Collector (Appeals) did not consider it. The appellant denied any mala fide intention and cited case laws to support their argument.

3. The Respondent's JDR contended that the reconciliation statement was not acceptable and that excess goods found in the store room without proper accountal were liable for confiscation under Rule 173Q.

4. The Tribunal noted that the reconciliation statement was submitted after verification of records and should have been considered by the Department. Considering the magnitude of operations and the possibility of accounting errors, the Tribunal agreed with the Collector (Appeals) that variations could be due to accounting errors. The Tribunal extended the benefit of doubt regarding missing parts reconciled later but confirmed duty demand on admitted shortages.

5. Regarding the excess goods found, the Tribunal cautioned the appellants to be more careful in the future and remitted the penalty. The Tribunal emphasized that the discrepancies were mainly due to accounting errors and not mala fide intentions, leading to the remittance of the penalty but with a warning to maintain proper accountal of excisable goods.