Clandine removal intent is essential for excise confiscation; mere stock non-accountal was held insufficient on these facts.

Mere non-accountal of finished excisable goods in statutory records did not, by itself, justify confiscation or penalty where the factory had been sealed by the bank and the record showed no clandestine removal, preparation for removal, or intent to evade duty. The applicable requirement for action under Rule 25 of the Central Excise Rules, 2002 was a culpable intention to remove goods clandestinely or evade duty, and that element was absent on the stated facts. The confiscation, redemption fine, and penalties were therefore unsustainable.

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Issues: Whether unaccounted finished goods found in a factory sealed by the bank, without evidence of clandestine removal or intent to evade duty, were liable to confiscation and penalty under the excise law.

Analysis: The factual matrix showed that the factory had been sealed by the bank before the stock verification and later de-sealed, and the record did not disclose any allegation or proof of clandestine clearance, preparation for removal, or past conduct suggesting evasion. Relying on the principles applied in earlier excise decisions, the operative requirement for confiscation and penalty was held to be the existence of a culpable intention to remove goods clandestinely or to evade duty; mere non-entry of stock in the statutory register, by itself, was insufficient. On those facts, the ingredients necessary for confiscation under Rule 25 of the Central Excise Rules, 2002 were not satisfied.

Conclusion: The confiscation, redemption fine, and penalties were unsustainable and the appeal was allowed.

Ratio Decidendi: Mere non-accountal of excisable goods does not justify confiscation or penalty unless the record establishes clandestine removal or an intention to evade duty.

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