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TMI Blog2001 (4) TMI 560X X X X Extracts X X X X X X X X Extracts X X X X ..... cation under Rule 173Q of the Central Excise Rules and whether penalty is imposable on all the Appellants. 2.1 Shri R. K. Kapoor, ld. Advocate for Appellants M/s. Jodhpur Supply Company, M/s. Crew B.O.S. Products Pvt. Ltd and Shri Tarun Oberoi, submitted that the main case of the Revenue against Appellant No. 1 related to demand of duty of excise amounting to Rs. 12,74,238 in respect of the goods manufactured and cleared by them for supply to M/s. Reebok India Company and M/s. Levis Strauss India Pvt. Ltd. under the brand names of Reebok and Levis ; that the said case has been got settled by M/s. Jodhpur Supply Company under the Kar Vivad Samadhan Scheme; that the present matters pertain to the confiscation of seized goods and imposition of penalty. The ld. Advocate, further, submitted that the entries in R.G. 1 register could not be made after 28-6-1997 as the employee who was assigned that work was on medical leave; that documentary evidence about illness was submitted to the Department; that Department has not alleged unauthorised removal of the goods which were lying in the factory; that the lapse was of technical nature; that all the issues regarding non-registration of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clandestinely and penalty also not be imposed under Rule 173Q. In Re: Sahib Singh Mfg. Co. Pvt. Ltd. - 1978 (2) E.L.T. (J 146) Kartar Steels Pvt. Ltd. v. C.C.E - 1997 (93) E.L.T. 443 (T) = 1997 (18) RLT 138 (CEGAT) 3. In respect of goods seized from the factory premises of M/s. Crew B.O.S. Products Pvt. Ltd. the ld. Advocate submitted that all the goods were meant for export and not for sale in India; that even this fact is confirmed by the show cause notice as it is mentioned therein that subsequent investigation of records revealed that no domestic sale was effected from M/s. Crew B.O.S. Products and all the goods being manufactured in the said M/s. Crew B.O.S. Products are meant for export ; that after the provisional release of the seized goods, the same were exported; that accordingly question of removal of goods without payment of duty does not arise as the goods were meant for export; that there was no loss of revenue to the Government as goods had been finally exported. He also referred to Board s Circular F. No. 212/46/96-CX, dated 20-5-1996 wherein it was mentioned that units may be asked to maintain a simple record of production and clearance and contended that e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one under K.V.S. Scheme. He submitted that accordingly no fine should have been imposed against them (co-noticee); that in any case redemption fine of Rs. 1,20,000/- is excessive and the same needs to be reduced considering the over-all facts and circumstances of the case and also considering the fact that they were forced by the Department to pay duty towards goods seized from their premises; that no duty can be charged from the buyers; that further the impugned goods were also covered by the demand of duty made by the Department from M/s. Jodhpur Supply Company; that duty is demandable only from the manufacturers. He finally submitted that in view of the K.V.S. Scheme, no penalty is imposable on them; that further there was no need for co-noticees to file any separate declaration, that even under Rule 209A penalty can be imposed only on a person, who knows or has reason to believe that the goods in respect of which he is dealing are liable to confiscation; that it has been held in Shri Nath Cement Industries v. C.C.E., Jaipur, 1994 (73) E.L.T. 142 (T) that the penalty under Rule 209A cannot be imposed in the absence of any evidence of guilty knowledge on the part of the person co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iod of time were not entered in RG 1 goods, these are liable to confiscation; that if person handling the work was not well for a prolonged period, some other arrangements should have been made by the Appellants; that the Board s instruction, relied upon by the ld. Advocate, was regarding entry of goods on day-to-day basis; that instruction provided that if goods are manufactured, enter the same if goods are cleared, enter the same in RG 1. He finally mentioned that Shri Tarun Oberoi is running the affairs of the Appellant; that he was found in the factory and he never claimed that he was a sleeping partner; that as such penalty is imposable on him; that the excisable goods found in the premises were cleared without non-payment of duty and as such these were rightly confiscated. 8. We have considered the submissions of both the sides. The present proceedings have been initiated by the Department in respect of the excisable goods which were seized as these were either cleared from the place of manufacture without payment of duty or were not entered in RG 1 register. The case which was settled by M/s. Jodhpur Supply Company under the Kar Vivad Samadhan Scheme, 1998, was in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance of record for a day on account of sudden sickness of the two store keepers. The Tribunal in the said case only reduced the redemption fine and penalty holding that fine and penalty has to be commensurate with the gravity of the offence. We also found no substance in the submissions of the Appellants that as goods manufactured by M/s. Crew B.O.S. Products (P) Ltd were for export, the goods need not be confiscated for non-entry in the statutory records. All the goods which are manufactured or produced are to be entered in RG 1 records. The goods meant for export out of India are not exempted goods as these are either exported under Rebate Procedure i.e. clearance on payment of duty, or under Bond Procedure, i.e. cleared on execution of Bond. In Alpha Garments - 1996 (86) E.L.T. 600, relied upon by the ld. Advocate, the Tribunal only held that demand of duty was not justifiable as the goods had been actually exported. But as regards penalty the Tribunal found force in the arguments advanced by the D.R. that persons should not be allowed to go scot free who have shown scant respect of law and contravened the provisions of the Central Excises and Salt Act and relevant rules. Acco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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