Technical breach in inter-unit movement of excisable goods supports confiscation, but penalties and personal liability may be reduced or set aside.

Movement of excisable goods between separately registered units without payment of duty and without compliance with prescribed excise formalities constituted contravention and justified confiscation. The breach was treated as technical on the facts, so the redemption fine and company penalties were reduced. Personal penalty under Rule 26 was not sustained because the manager's role was not adequately proved to warrant penal action. The article thus states that confiscation may stand for unauthorised inter-unit transfer of excisable goods, while monetary penalties and individual liability depend on the nature of the breach and the established role of the person concerned.

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Issues: (i) Whether the confiscation of the mobile cranes and the penalties imposed were sustainable when the goods were shifted between adjacent units having separate central excise registrations, and (ii) whether penalty under Rule 26 could be sustained against the manager.

Issue (i): Whether the confiscation of the mobile cranes and the penalties imposed were sustainable when the goods were shifted between adjacent units having separate central excise registrations.

Analysis: The cranes had been manufactured by one unit and found in the adjacent premises of another unit. At the relevant time, the two units were separately registered under central excise law, so clearance from one unit to the other required observance of duty and prescribed formalities. Even if the goods were not fully finished, their movement without duty payment and without compliance with excise procedure constituted contravention. However, in the overall facts, the breach was treated as technical, warranting interference only on the quantum of fine and penalty.

Conclusion: Confiscation was upheld, but the redemption fine and penalties on the two companies were reduced.

Issue (ii): Whether penalty under Rule 26 could be sustained against the manager.

Analysis: The manager's role did not justify personal penalty in the circumstances, and the material on record did not call for penal action against him.

Conclusion: Penalty on the manager was set aside.

Final Conclusion: The appeals were disposed of by sustaining confiscation, reducing the monetary liabilities of the companies, and granting complete relief to the manager.

Ratio Decidendi: Movement of excisable goods between separately registered units without payment of duty may justify confiscation, but where the breach is merely technical, the fine and penalties may be reduced and personal penalty must depend on the proved role of the individual.

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