Record-keeping default in excise registers: specific rule applied and penalty reduced for non-entry of manufactured goods.

Failure to enter manufactured goods in the RG1 register was treated as a record-keeping default, not as conduct showing intent to evade duty. Rule 173Q(1)(b) was found inapplicable because "account for" does not mean a mere bookkeeping entry, and the goods were otherwise accounted for when found. Rule 226 specifically governed non-maintenance of required manufacturing records and provided for confiscation with a limited penalty. The penalty was therefore reduced, while the contravention and confiscation were otherwise sustained.

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Issues: Whether the contravention for failure to enter manufactured goods in the RG1 register was governed by Rule 226 of the Central Excise Rules, 1944 rather than Rule 173Q(1)(b) of the Central Excise Rules, 1944, and whether the penalty required reduction.

Analysis: The omission was confined to non-entry of goods in the RG1 register and did not establish any intent to evade duty. Rule 173Q(1)(b) was held inapplicable because the expression "account for" is not the same as entering goods in the account, and the goods were otherwise accounted for when found. Rule 226 specifically covered failure to maintain the records required of a manufacturer and provided for confiscation and a limited penalty.

Conclusion: Rule 226 applied, not Rule 173Q(1)(b), and the penalty was reduced to Rs. 2,000.

Final Conclusion: The appeal succeeded only to the extent of reduction of penalty, while the finding of contravention and confiscation otherwise stood.

Ratio Decidendi: Where the default is only failure to make a statutory record entry and there is no intent to evade duty, the specific rule dealing with non-maintenance of records governs, and a broader confiscation penalty provision cannot be applied by equating "account for" with mere bookkeeping entry.

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