2000 (9) TMI 541 - AT - Central Excise

Penalty - Clandestine removal - Evidence - Demand - Accountal of goods - Appeal to Appellate Tribunal

Summary

Issues Involved:
1. Removal of goods against inadequate balance in statutory records.
2. Removal of goods on specific dates without proper documentation.
3. Clandestine removal of finished goods.
4. Suppression of production involving duty.
5. Shortage of acrylic plastic scrap and Modvat credit.
6. Availment of inadmissible credit under Central Excise Rules.
7. Penalty imposition and recovery of interest.

Issue I: Removal of goods against inadequate balance in Statutory records:
The appellants admitted the charge but claimed they believed they had adequate balance. However, since goods were cleared against insufficient balance, the penalty was rightly imposed by the Commissioner. The duty amount involved was debited by the appellants.

Issue II: Removal of goods on specific dates without proper documentation:
Evidence from loose sheets found with the General Manager indicated goods were cleared without proper records or duty payment. The General Manager's admission was considered reliable, and the chronological entries in the sheets supported the duty demand of Rs. 1,42,000.

Issue III: Clandestine removal of finished goods:
Based on production reports, a significant quantity of finished goods was clandestinely removed. The Director admitted the duty liability, and the charge was upheld due to the lack of substantiating records by the appellants.

Issue IV: Suppression of production involving duty:
The General Manager admitted to removing unaccounted production without proper records or duty payment. The appellants' defense regarding quality control testing was not supported by evidence, leading to the confirmation of duty demand.

Issue V: Shortage of acrylic plastic scrap and Modvat credit:
A shortage of acrylic plastic scrap was confirmed through a panchnama and the General Manager's admission. The appellants' argument against physical stock taking was dismissed, and the finding was upheld.

Issue VI: Availment of inadmissible credit under Central Excise Rules:
The appellants failed to prove the receipt of inputs at the factory premises, leading to the conclusion that credit was availed without fulfilling legal requirements. The lack of transport documents and delayed submission of evidence resulted in upholding the charge of inadmissible credit.

Issue VII: Penalty imposition and recovery of interest:
Penalties were upheld due to confirmed duty demands and denial of Modvat credit. However, considering the circumstances, the penalty on the company was reduced, and interest recovery was clarified to apply only to the duty amount, not the Modvat credit.

The judgment concluded by disposing of the appeals with the outlined decisions on each issue, emphasizing the importance of compliance with statutory provisions and documentation in excise matters.