Section 11D liability applies where excise duty is collected from buyers but not deposited, while factory-held goods were not confiscable.

Amounts collected from buyers as excise duty but not remitted to the Government were held payable to the Central Government under Section 11D, because invoices, purchase orders and buyer statements showed that the appellant charged duty at the contracted price while paying duty only at a concessional rate. The maintenance of two sets of invoices supported a finding that the excess duty amounts were deliberately retained, so the penalty under Rule 173Q was sustained. Confiscation of goods was, however, set aside because the goods were still within the factory premises and had not left the place of manufacture, making confiscation unjustified on those facts.

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Issues: (i) Whether the amounts collected from buyers in the name of Central Excise duty and not deposited with the Government were payable under Section 11D of the Central Excise Act, 1944, and whether penalty was leviable under Rule 173Q of the Central Excise Rules, 1944; (ii) Whether the goods loaded in the tempo and lying within the factory were liable to confiscation.

Issue (i): Whether the amounts collected from buyers in the name of Central Excise duty and not deposited with the Government were payable under Section 11D of the Central Excise Act, 1944, and whether penalty was leviable under Rule 173Q of the Central Excise Rules, 1944.

Analysis: The invoices, purchase orders and buyer statements showed that the appellant charged the contracted price plus full excise duty, while paying duty only at the concessional rate. The maintenance of two sets of invoices with different particulars for the same clearances supported the conclusion that excess amounts were collected as duty and retained. The documentation was not a mere procedural lapse, but a deliberate method of representing and collecting excise duty differently from the actual duty paid.

Conclusion: The amounts collected were rightly held payable to the credit of the Central Government under Section 11D, and the penalty under Rule 173Q was sustained.

Issue (ii): Whether the goods loaded in the tempo and lying within the factory premises were liable to confiscation.

Analysis: The goods had not left the factory premises, and the seizure and confiscation were based on incomplete particulars in the records and discrepancies between invoice copies. Since the clearances were still within the stage where documentation had to be completed, confiscation was not justified on those facts.

Conclusion: The confiscation of the goods was set aside.

Final Conclusion: The demand under Section 11D and the penalty were upheld, but the confiscation of the goods was deleted, resulting in only partial relief to the assessee.

Ratio Decidendi: Where a manufacturer collects amounts from buyers as excise duty but retains them without depositing the same, Section 11D applies; confiscation is not warranted for goods still within the factory premises merely because invoice particulars are discrepant.

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