Technical breach of repair-return time limit did not justify penalty where no duty evasion was found.

Breach of the time limit for returning goods sent for repairs or reconditioning under Rule 173H did not justify penalty where the delay was technical and no intent to evade duty was found. The Tribunal noted that Rule 210 could be invoked if no specific penalty was provided for the violation, but penalty is meant to secure compliance, not to punish every venial breach. It also noted that the goods were not liable to confiscation under Rule 173Q. On those facts, the penalty was held unjustified and was set aside.

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Issues: Whether penalty was leviable for breach of the time limit prescribed for return of goods brought for repairs/reconditioning under Rule 173H of the Central Excise Rules, and whether such penalty could be imposed under Rule 210 of the Central Excise Rules.

Analysis: The goods had been sent back for repairs/reconditioning and were not removed within the six-month period fixed by the Commissioner through a trade notice. The Tribunal held that where no specific penalty was otherwise provided for the breach, Rule 210 could be invoked for violation of the rules. However, it also noted that the lower authorities had found no intention to evade duty and that the goods were not liable for confiscation under Rule 173Q of the Central Excise Rules. Relying on the principle that penalty is not to be imposed for every technical or venial breach, the Tribunal held that the power to penalise is meant to secure compliance and not to operate punitively in every instance of breach.

Conclusion: The penalty was not justified and was set aside.

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