2018 (5) TMI 1502 - AT - Central Excise

Clandestine removal - excess stock of MS Sheets, Scrap and MS Pipes - confiscation - Held that - Even though the appellant has vehemently argued that the said stock was due to non-writing of the RG-I register for two days however, the same theory seems to be non-workable in the face of other evidences - The department visited their buyer s premises, namely, Super Traders and found approximately 8.953 MT of MS Pipes cleared from the appellant s premises without payment of duty - confiscation upheld - quantum of redemption fine reduced - appeal allowed in part.

Summary

Issues: Appeal against order-in-appeal for confiscation of excess stock and penalty imposition.

In this case, the appellant, engaged in the manufacture of MS Sheet and MS Pipes, filed an appeal against the order-in-appeal passed by the Commissioner (Appeals-I) Ahmedabad. The appellant's factory was searched, revealing excess stock of 120.65 MT valued at &8377; 29,69,320, which was seized. Additionally, 8.953 MT of MS Pipes were found in the buyer's premises without duty payment, admitted to be cleared from the appellant's premises, and also seized. Subsequently, a show cause notice (SCN) was issued for confiscation of goods and penalty imposition. The demand was confirmed, excess goods were directed to be confiscated with an option to redeem on payment of fine and duty with penalty, and duty on goods found in the buyer's premises was confirmed with interest and penalty. The appellant contended that the excess stock was due to a non-entry in the register for two days, cleared later on payment of duty, and argued against the confiscation and penalty as disproportionate. The Revenue argued that the confiscation was justified as stocks were found in the buyer's premises without duty payment. The Tribunal found the excess stock to be in all probability meant for clandestine clearance, upholding the confiscation but reducing the redemption fine to &8377; 4 lakhs. The impugned order was upheld with the modification, and the appeal was partly allowed.

In summary, the issues involved in this legal judgment revolved around the confiscation of excess stock, penalty imposition, and the justification for the same based on the circumstances and evidence presented during the investigation and adjudication process. The Tribunal ultimately upheld the confiscation but reduced the redemption fine, considering the facts and arguments presented by both parties.