2019 (12) TMI 107 - AT - Central Excise

Recovery of the alleged short paid excise duty - delay of 10 days in filing appeal - HELD THAT - The lacuna noticed against the appellant is that he was clearing his manufactured finished goods without paying the excise duty. Finished goods and the stock taking thereof was conducted at the time of search of four premises of the appellant which was done in the presence of the appellant s authorized person and even in the presence of independent witnesses. There has been specific details of the stock of finished goods as was found available in the premises of the appellant and was seized by the Department. It is apparent that there was no denial on part of the appellant at the time of said such search, for stock found and seized finished goods. It is only six months after that the appellant came up with a plea that the stock as was found at the time of search was not of finished goods. Except the said submission there is apparently no such documentary evidence produced by the appellant which may falsify the details of six various kinds of final goods and the respective quantity as was got recorded in the panchnama on 21.7.2014. The mere submission of the appellant that since the testing and inspection by their buyers was not yet conducted that the goods could not be called as finished goods is also not tenable for want of specification of testing and inspection. In the given circumstances, that appellant has violated rule 10 of Central Excise Rules 2002. There is no infirmity in the order under challenge while confirming the proposal not only of the demand of not paid excise duty but also of the confiscation. The redemption fine of ₹ 4,08,570/- as was imposed and as has already been deposited by the appellant is also hereby denied to be refunded - the appeals stands dismissed not only for want of prosecution on part of the appellant but also for want of any merits supporting his case.

Issues:
1. Negligent conduct of the appellant in pursuing the appeal.
2. Allegations of manufacturing and clearing excisable goods without payment of appropriate duties.
3. Seizure of finished goods during search operations.
4. Inadequate maintenance of records by the appellant.
5. Violation of Central Excise Rules 2002.
6. Confirmation of demand for unpaid excise duty, penalty, and confiscation.
7. Denial of redemption fine and imposition of penalties.

Analysis:

Issue 1: Negligent conduct of the appellant in pursuing the appeal
The appellant was granted multiple opportunities to present their case, but they failed to diligently pursue the appeal, leading to the decision being made based on merits in their absence.

Issue 2: Allegations of manufacturing and clearing excisable goods without payment of appropriate duties
Search operations revealed that the appellant was involved in manufacturing and clearing excisable goods without paying the required excise duty, leading to the issuance of a show cause notice for recovery of the unpaid duty, interest, and penalties.

Issue 3: Seizure of finished goods during search operations
During the search at the appellant's premises, finished goods were found and seized by the Department, indicating non-compliance with excise duty regulations.

Issue 4: Inadequate maintenance of records by the appellant
The appellant's RG-1 register showed nil stock of finished goods, contradicting the physical presence of finished goods during the search. This discrepancy led to the conclusion that the register contained false entries.

Issue 5: Violation of Central Excise Rules 2002
The appellant's failure to maintain proper records as required by the Central Excise Rules 2002, along with the inability to provide evidence to refute the seized finished goods, constituted a violation of the rules.

Issue 6: Confirmation of demand for unpaid excise duty, penalty, and confiscation
The order confirmed the demand for unpaid excise duty, imposed penalties, and ordered the confiscation of goods based on the appellant's non-compliance with excise duty regulations.

Issue 7: Denial of redemption fine and imposition of penalties
The redemption fine imposed was denied for refund, and penalties were upheld due to the appellant's improper record-keeping and violation of rules, leading to the dismissal of the appeals for lack of prosecution and merit.

This detailed analysis of the judgment highlights the key issues, findings, and conclusions reached by the tribunal in the case.

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