2000 (5) TMI 296 - AT - Central Excise

Summary

Issues:
1. Claim for abatement of duty under Rule 96ZO.
2. Confiscation of seized goods and imposition of fine.
3. Challenge against redemption fine and penalty.
4. Dispute regarding stock position and non-accountal in RG-1 Register.

Analysis:

1. Claim for abatement of duty under Rule 96ZO:
The appellants, engaged in manufacturing M.S. Ingots, closed their unit for a period and claimed abatement of duty under Rule 96ZO. However, they did not pursue this claim, leading to a discrepancy in stock and meter readings when Central Excise officers visited the factory. The appellants attributed the stock difference to miscalculation, but the actual excess stock was not disputed. This issue was not resolved, and the claim for abatement was abandoned.

2. Confiscation of seized goods and imposition of fine:
Central Excise officers found an excess stock of M.S. Ingots during a visit and seized the goods, leading to a show cause notice and subsequent confiscation by the Assistant Commissioner. The Commissioner (Appeals) upheld the decision but reduced the penalty. The main contention was the imposition of a redemption fine of Rs. 25,000, which the appellants argued was beyond the scope of Section 34 of the Central Excise Act. The judgment highlighted that the fine imposed was not in lieu of confiscation but for "other charges," which was deemed unjustifiable.

3. Challenge against redemption fine and penalty:
The appellants challenged the redemption fine and penalty, arguing that the explanation for the stock difference was not properly considered. The judgment noted that the fine imposed for reasons other than in lieu of confiscation was beyond the Act's provisions. The redemption fine was reduced to Rs. 10,000, and the penalty of Rs. 2,000 under Rule 226 of the Central Excise Rules was upheld due to the unrebutted charge of non-accountal in the RG-1 Register.

4. Dispute regarding stock position and non-accountal in RG-1 Register:
The discrepancy in stock position and meter readings, along with the charge of non-accountal of goods in the RG-1 Register, remained unresolved. The appellants' explanation for the stock difference was attributed to miscalculation, but the judgment emphasized that the charge of non-accountal stood unrebutted. The imposition of the penalty was justified based on this charge, despite the appellants' arguments.

In conclusion, the judgment partially allowed the appeal by reducing the redemption fine and upholding the penalty, emphasizing the importance of proper documentation and compliance with Central Excise regulations to avoid discrepancies and penalties.