1998 (5) TMI 241 - AT - Central Excise

Summary

Issues:
1. Clubbing of clearances of two industries
2. Seizure and confiscation of unrecorded goods
3. Confirmation of demand on short goods
4. Imposition of penalty
5. Confiscation of building and land

Clubbing of Clearances:
The appeals revolved around whether the clearances of two separate units should be clubbed together for determining exemption eligibility and duty demands. The appellants argued that the units were independent, had different business operations, and were separately registered as SSI units. The adjudicating authority raised issues of profit sharing, loan advancements without interest, and job work charges to justify clubbing. The Counsel for the appellants cited precedents to argue against clubbing, emphasizing lack of evidence for profit sharing and loan interest charges. The Tribunal concurred, finding no evidence of profit sharing or loan interest charges, thus ruling against clubbing the clearances.

Seizure and Confiscation:
Regarding the seizure and confiscation of unrecorded goods found in excess, the appellants explained that the goods were in a semi-finished stage and not yet recorded in the RG 1 register. They argued that since the goods were for the Defense Organization and not fully manufactured, confiscation was unwarranted. The Revenue contended that the goods were fully manufactured and chargeable to duty, citing the necessity of recording in the RG-1 register. The Tribunal found that the goods were not in a marketable condition, hence not necessitating recording in the register, leading to setting aside the confiscation orders.

Confirmation of Demand:
The demand confirmation on short goods valued at Rs. 2,45,700/- lacked a satisfactory explanation from the appellants. Consequently, the Tribunal confirmed a reduced demand of Rs. 2,074.80.

Imposition of Penalty:
The imposition of penalty was reduced to Rs. 10,000/- due to unexplained short stocks. The Tribunal upheld the impugned order with modifications, setting aside the confiscation of excess goods and property while providing for any consequential relief according to the law.