2000 (5) TMI 645 - AT - Central Excise

Summary

Issues:
Violation of Notification No. 175/86-C.E., dated 1-3-86; Confiscation of goods; Imposition of penalty.

Violation of Notification No. 175/86-C.E., dated 1-3-86:
The appellants, engaged in manufacturing Radio Cassette Recorders, imported cabinets with foreign brand names like 'National' and 'Sony.' They concealed these names temporarily with black tape and affixed their own brand name stickers. The Collector confirmed duty demand and ordered confiscation of goods due to misuse of Notification No. 175/86-C.E. The appellants argued they were entitled to the exemption as SSI unit holders. However, the Tribunal ruled that affixing ineligible brand names on goods disqualifies them from the exemption, citing Namtech Systems Ltd. case as precedent. The Tribunal rejected earlier judgments supporting the appellants' claim, upholding the Collector's decision.

Confiscation of goods:
The Collector confiscated 300 Radio Cassette Recorders seized from the factory premises and imposed duty demand and penalty. The appellants contested, claiming they did not use the foreign brand names 'National' and 'Sony' on their products directly. They argued that affixing the brand names on imported cabinets did not disqualify them from the exemption. However, the Tribunal upheld the confiscation and penalty, stating that the appellants were rightly denied the benefit of the Notification due to the affixed ineligible brand names.

Imposition of penalty:
In addition to confirming the duty demand, the Collector imposed a penalty on the appellants. The appellants challenged this penalty, emphasizing that they did not directly use the foreign brand names on their products. They relied on previous judgments to support their case. However, the Tribunal upheld the penalty, citing the Namtech Systems Ltd. case and ruling that the appellants were correctly denied the benefit of the Notification. Consequently, the appeal was dismissed for lack of merit.