2005 (9) TMI 422 - AT - Central Excise

Tribunal decisions on excise duty, penalty, interest, and confiscation

The Tribunal upheld the demand of Central Excise duty and penalty for 28 invoices, dismissed the appeal challenging the penalty amount, and upheld the ... Confiscation of goods - Non-accountal in RG1 register - Demand - Clandestine removal Issues Involved:1. Demand of Central Excise duty for 28 invoices.2. Imposition of penalty equal to the duty calculated for 28 invoices.3. Recovery of interest on the confirmed duty amount.4. Setting aside the demand for 89 invoices.5. Confiscation of goods seized in the factory premises.6. Reduction in mandatory penalty imposed by the adjudicating authority.Issue-Wise Detailed Analysis:1. Demand of Central Excise Duty for 28 Invoices:The appellant challenged the order confirming the demand for Central Excise duty for 28 invoices. The Tribunal found cogent evidence supporting the excess removal of goods as indicated in the 28 invoices and corresponding packing slips, which were recovered from the consignees. The Tribunal upheld the demand as there was sufficient corroboration from the statements of the commercial assistant of the consignees, confirming the excess quantity of excisable goods supplied.2. Imposition of Penalty Equal to the Duty Calculated for 28 Invoices:The appellant contended that the penalty should be reduced further under Section 11AC. The Tribunal, however, found no valid reason to interfere with the penalty of Rs. 77,788/- imposed, which corresponded to the confirmed duty demand. The Tribunal referenced the Supreme Court decision in State of Madhya Pradesh v. Bharat Heavy Electricals, emphasizing that the penalty stipulated was the maximum amount and the assessing authority had discretion to levy a lesser amount.3. Recovery of Interest on the Confirmed Duty Amount:The Tribunal upheld the recovery of interest on the confirmed duty amount as per Section 11AB, finding no valid reason to interfere with the impugned orders regarding the interest.4. Setting Aside the Demand for 89 Invoices:The Revenue challenged the setting aside of the demand for 89 invoices. The Tribunal found that there was no specific admission or evidence to support the excess removal of goods for these invoices. The statement of the appellant's employee was general and did not specifically address the 89 invoices. Thus, the Tribunal agreed with the Commissioner (Appeals) in setting aside the demand for these invoices, as no conjecture was permissible without concrete evidence.5. Confiscation of Goods Seized in the Factory Premises:The Tribunal addressed the confiscation of goods not noted in the RG I register. It referenced the decision in Bhillai Conductors Ltd. v. CCE, Raipur, which required mens rea for confiscation under Clause (d) of Rule 173Q(1). The Tribunal found no evidence of the requisite guilty mind and thus upheld the setting aside of the confiscation order. The Tribunal distinguished this case from others cited by the department, emphasizing the necessity of mens rea for confiscation under the alleged contraventions of Rules 53 and 173G.6. Reduction in Mandatory Penalty Imposed by the Adjudicating Authority:The Tribunal noted that the Commissioner (Appeals) had reduced the mandatory penalty imposed by the adjudicating authority. The Tribunal found no reason to interfere with this reduction, as the penalty imposed was proportionate to the confirmed duty demand.Conclusion:The Tribunal dismissed both appeals, upholding the demand of duty and penalty for the 28 invoices, setting aside the demand for the 89 invoices, and maintaining the decision to not confiscate the goods due to the lack of mens rea. The recovery of interest on the confirmed duty amount was also upheld.