Incorrect RG-I entries without intent to evade duty fall under defective record-keeping, not confiscatory provisions.

Mere non-entry of daily production in the RG-I register, when production was otherwise contemporaneously recorded in internal transfer slips and production records, was treated as a bona fide record-keeping lapse rather than concealment or intent to evade duty. The Tribunal distinguished failure to account for excisable goods from failure to maintain statutory records correctly, holding that Rule 173Q applies to non-accountal of goods, not to incorrect or incomplete entries in account books. On these facts, the lapse fell within Rule 226, attracting only the limited penalty and confiscation consequences provided for defective maintenance of records.

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Issues: Whether non-entry of daily production in the RG-I register, where production was otherwise reflected in the assessee's internal transfer slips and production records, attracted confiscation and penalty under Rule 173Q or only the limited penalty under Rule 226.

Analysis: The internal production slips and transfer slips showed continuous recording of daily production, with serially numbered entries and signatures of the concerned departments. On these facts, the non-entry in RG-I was treated as a bona fide administrative lapse rather than a concealment of production or a contravention carried out with intent to evade duty. Rule 173Q was held to cover cases where goods are not accounted for in the sense of failing to explain their lawful disposal or dealing, and not mere failure to make correct entries in an account book. The Tribunal relied on the distinction between failure to account for goods and failure to maintain records correctly, and held that the latter falls within Rule 226.

Conclusion: Rule 173Q was held not to apply on these facts, and the matter was confined to Rule 226, carrying only the limited penalty and confiscation consequences provided therein.

Ratio Decidendi: Mere incorrect or delayed entries in statutory stock records, without mens rea or intent to evade duty, do not attract the confiscatory and penal provisions meant for non-accountal of excisable goods; such a lapse is governed by the provision prescribing punishment for defective maintenance of records.

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