2002 (4) TMI 547 - AT - Central Excise

Tribunal rules on excisable goods exemption, penalties, and duty demands

The tribunal ruled that excisable goods bearing another company's brand name were not eligible for Small Scale exemption, leading to a recalculation of ... SSI Exemption - Penalty - Confiscation and redemption fine Issues:1. Whether excisable goods manufactured by a company are eligible for Small Scale exemption under a specific notification if they bear a brand name belonging to another company.2. Whether the goods seized from the company's premises are liable for confiscation.3. Imposition of penalties on the company and individuals involved.4. Recalculation of duty demand and penalties based on the findings.Analysis:1. The primary issue in this case revolved around the eligibility of excisable goods manufactured by a company for Small Scale exemption under a specific notification when they bear a brand name belonging to another company. The appellant argued that the brand names were assigned to them by the other company through a deed in 1995, even though this deed was not disclosed during the investigation. The tribunal found that the assignment deed was an afterthought and ruled that the goods bearing another person's brand name were not eligible for the exemption, as per Notification No. 1/93-C.E. The duty demand was to be recalculated accordingly.2. The next issue concerned the confiscation of goods seized from the company's premises. The tribunal determined that the goods were liable for confiscation as they were cleared without the appropriate duty payment. The penalty imposed on the company was reduced to Rs. 15,000, and the penalty on an individual was set aside. However, another company involved was ordered to pay a penalty of Rs. 5,000 for purchasing goods liable for confiscation due to the wrongful exemption availed.3. Regarding penalties, it was established that separate penalties cannot be imposed on a proprietary concern and its proprietor. The tribunal reduced the penalties imposed on the parties involved and directed the recalculated duty demand to be honored. The penalty on the company was reduced to Rs. 15,000, and the penalty on the individual was set aside. The other company was directed to pay a penalty of Rs. 5,000 for purchasing goods liable for confiscation.4. The final issue addressed the penalties and the confiscation of goods seized from different locations. The tribunal reduced the redemption fine for the seized goods from both locations and disposed of all three appeals accordingly. The redemption fine was reduced from Rs. 75,000 to Rs. 40,000 for goods seized from the tempo and factory premises, and from Rs. 85,000 to Rs. 40,000 for goods seized from the other company's premises.