Non-accountal of finished goods can justify confiscation and penalty even without proof of mens rea to clandestinely remove them.

Non-accountal of finished goods can attract confiscation, redemption fine and penalty under Rule 173Q(1)(b) even where no mens rea to clandestinely remove the goods is shown. The commentary notes that the Commissioner (Appeals) had relied on Tribunal rulings to set aside the penalties for want of intent, but binding High Court authority took precedence and held that mens rea is not required for invoking the rule in cases of non-accountal. On that basis, the appellate order setting aside confiscation and redemption fine was not sustainable, and restoration of the Revenue's order was upheld.

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Issues: Whether confiscation and redemption fine could be set aside in a case of non-accountal of finished goods on the ground that there was no mens rea to remove the goods clandestinely.

Analysis: The respondents did not dispute the non-accountal of finished goods. The Commissioner (Appeals) had relied on Tribunal decisions holding that, in the absence of mens rea, Rule 173Q could not be invoked for non-accountal. The appellate authority, however, noticed binding High Court authority holding that in cases of non-accountal of goods, Rule 173Q(1)(b) can be invoked even without proof of mens rea to clandestinely remove the goods. Since a High Court ruling prevails over a Tribunal decision, the order of the Commissioner (Appeals) could not be sustained.

Conclusion: The setting aside of confiscation and redemption fine was unjustified, and the order restoring confiscation, redemption fine, and penalty was upheld in favour of the Revenue.

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