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TMI Blog2009 (12) TMI 417X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany and a penalty on Shri Rakesh Panchal. Hence, the appeals. Held that- the appellants have contravened the provisions of Rule 25(c) of Central Excise Rules, 2002 when they moved the raw materials to Plot No. 1506 and under-took the manufacturing process and just because the materials have reached the semi-finished stage, they cannot claim that the same cannot be confiscated. Therefore, hold that the confiscation ordered by the lower authorities is in order and is required to be upheld. But take the lenient view about the penalty and fine. Thus, redemption fine is reduced to Rs. 60,000/- and penalty on the director is reduced to Rs. 25,000/-. - E/751-752/2009 - A/36-37/2010-WZB/AHD - Dated:- 30-12-2009 - Shri B.S.V. Murthy, Member ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted (total amount paid was more than Rs. 24 lakhs). Further, a penalty of Rs. 6,00,005/- has also been imposed on the Company and a penalty on Shri Rakesh Panchal. Hence, the appeals. 2. Learned advocate on behalf of the appellant submitted that the demand appropriated of Rs. 6,00,005/- out of the duty paid on the finished goods towards duty on raw material under Rule 25 of Central Excise Rules, 2002, is not correct and it is his submission that this rule has been wrongly invoked and is not at all applicable. Further, he also submitted that duty could not have been demanded on these raw materials under Rule 25 in view of the fact that the goods which were seized were actually semi-finished goods and not raw material viz, steel coils and f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re available on their records. Nevertheless, the fact remains that the Commissioner had ordered provisional release on 20-10-06 and this has been accepted even by divisional office. It is his submission that the appellants, therefore, had not committed any mistake in this regard. 3. Learned SDR, on behalf of the Revenue, on the other hand, submitted that Rule 25 has been correctly invoked. He drew my attention to sub-rule 3 of Rule 25 which provides for penalty and confiscation where the manufacturer engages in the manufacture; production, storage of any excisable goods without having applied for the registration certificate required under Section 6 of the Act. In this case, it is his submission that the semi-finished goods were seized fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed out of the seized raw materials was totally irregular and therefore confiscation was perfectly in accordance with the law. He also submits that the change of status of the raw materials from the stage of raw materials to semi-finished goods stage would not make any difference since the movement of raw materials from Plot No. 1504 to 1506 itself was irregular and improper and was not in accordance with the law. 4. I have considered the submissions made by both sides. I find that the amount of Rs. 6,00,005/- has been appropriated out of the duty paid on the finished goods in the impugned order. The appropriation of this amount in my understanding would mean that the Department accepts that the raw material under seizure in the form of se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reason, he could not file the application to add Plot No. 1506 and Shri Rakesh Panchal, Director in his statement had stated that they were negotiating and in fact had concluded a deal for purchasing a Plot No. 1505 and therefore the appellants had an intention to make an application to have a registration certificate for Plot No. 1504 to 1506. But, before they could do so, the visit of the officers took place and apparently to fulfil the order, they had chosen to move the raw materials to Plot which was not included in the registered premises. It is also noticed that the appellants had made an application for provisional release promptly and executed a bond and provided a bank guarantee for the full amount of duty involved to get the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on certificate, all such goods are liable to confiscation. Naturally, between the raw materials and the finished product, there can be several stages and it would be ridiculous to say that excisable goods in the form of only raw materials or finished products can be confiscated. Therefore, I have to hold that the confiscation ordered by the lower authorities is in order and is required to be upheld. I also agree with the learned' advocate that there were mitigating factors in this case and also find that the lower authorities have been very reasonable. Learned advocate submitted that if the confiscation were to be upheld, redemption fine imposed by the lower authorities and the penalty on the director are required to be reduced since they a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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