Penalty for duty-compliance breach upheld where bona fide mistake and credit balance did not negate intent to evade duty.

A bona fide mistake and the existence of a personal ledger credit balance did not, by themselves, negate intent to evade duty where excisable goods were cleared without proper debit of duty or supporting documents. The appellant did not dispute duty liability and challenged only the penalty, but the explanation that some engines were exempt or that spare parts were not manufactured in the factory was not accepted on the facts. The penalty was found justified and proportionate, and the challenge to the Commissioner's order failed.

---

---

Issues: Whether the penalty imposed on the appellant for clearance of excisable goods without proper debit of duty or supporting documents was liable to be set aside on the ground of bona fide error and absence of intention to evade duty.

Analysis: The appeal did not dispute the duty liability of the goods and was confined to the penalty. The pleaded explanation of bona fide mistake in not debiting duty and the assertion that certain engines were exempt or that spare parts were not manufactured in the factory was not accepted. The record did not show that the Department had found absence of intent to evade, and the existence of balance in the personal ledger account did not negate the possibility of evasion. The authorities relied upon by the appellant were held inapplicable on the facts.

Conclusion: The penalty was held to be justified and proportionate, and the challenge to the Commissioner's order failed.

Final Conclusion: The appeal was rejected on merits, leaving the duty-related penalty undisturbed.

Ratio Decidendi: Mere bona fide explanation or availability of credit balance does not by itself negate intent to evade duty where excisable goods are cleared without proper duty compliance and the facts do not establish the absence of such intent.

---