CESTAT Mumbai upholds goods confiscation for duty evasion, reduces redemption fine.

The Appellate Tribunal CESTAT, Mumbai upheld the confiscation of goods due to removal without discharging duty but reduced the redemption fine to Rs. 3 lakhs. The tribunal considered the appellant's argument regarding permission for keeping raw materials outside the factory, leading to the confiscation of finished goods. Despite acknowledging no clandestine intent, the tribunal modified the redemption fine based on the factory's early stage of operation. The tribunal carefully reviewed submissions from both parties and records before making its decision, rejecting the appeal except for the specific modification of the redemption fine.

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Issues: Challenge to redemption fine imposed on confiscated goods.

The judgment delivered by the Appellate Tribunal CESTAT, Mumbai involved a challenge to the redemption fine imposed on confiscated goods. The appellant did not contest the duty demand or penalty but specifically disputed the amount of redemption fine levied by the adjudicating authority. The appellant argued that the goods were seized when the factory was handled by technical personnel unaware of excise procedures. The appellant had sought permission to keep raw materials outside the factory due to space constraints, but had not sought similar permission for finished goods. The tribunal noted that while there was no intention to remove goods clandestinely, goods without discharged duty removed from the factory were liable for confiscation. Considering the factory's nascent stage, the tribunal reduced the redemption fine to Rs. 3 lakhs, upholding the confiscation of goods and rejecting the appeal except for this modification.

The tribunal carefully considered the submissions made by both parties and reviewed the records before reaching its decision. The appellant's argument that they were not challenging the duty demand or penalty but only the redemption fine was duly noted. The tribunal observed that the appellant had sought permission to keep raw materials outside the factory premises due to space shortages but had not sought similar permission for finished goods, leading to the confiscation of goods removed without discharging duty. Despite acknowledging no clandestine intention, the tribunal upheld the confiscation order for such goods and decided to reduce the redemption fine to Rs. 3 lakhs based on the factory's early stage of operation.

In analyzing the case, the tribunal found that the appellant's failure to seek permission for keeping finished goods outside the factory premises, despite space constraints, led to the confiscation of goods removed without discharging duty. The tribunal noted the proper documentation indicating the removal of goods for storage in a warehouse, indicating no clandestine intent. However, due to the factory's early stage, the tribunal decided to reduce the redemption fine to Rs. 3 lakhs to meet the ends of justice. The tribunal upheld the confiscation order for goods without discharged duty while modifying the redemption fine, rejecting the appeal except for this specific modification.

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