Non-accountal of excisable goods can support an inference of intent to evade duty, sustaining confiscation and penalty.

Non-accountal of excisable goods found packed in a store room, coupled with the absence of RG 1 entry, production slips, quality-control records and proper raw-material accounting, justified an inference that the goods were liable to be removed and that the omission was not a mere clerical lapse. Because the explanation that the television sets were day's production awaiting inspection was unsupported by contemporaneous records or the partner's statement, intent to evade duty could be inferred. Confiscation, redemption fine and penalty were therefore sustained, and the assessee's challenge failed.

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Issues: Whether confiscation of the television sets and the penalty imposed for non-entry of production and related stock particulars were sustainable under the excise rules on the facts found.

Analysis: The goods were found packed in the store room without entry in the RG 1 register, and the explanation that they were day's production awaiting quality control inspection was not supported by the partner's statement or by any contemporaneous records. The absence of production slips, quality-control records, and proper raw-material accounting, coupled with the shortage of inputs, justified an inference that the goods were liable to be removed and that the omission was not a mere clerical lapse. On those facts, the requisite intent to evade duty could legitimately be inferred, making confiscation and penalty sustainable.

Conclusion: The confiscation and penalty were upheld, and the assessee's challenge failed.

Final Conclusion: The adjudication in favour of the department was restored, with the confiscation, redemption fine, and penalty maintained.

Ratio Decidendi: Where non-accountal of excisable goods is supported by surrounding circumstances showing a likely attempt to remove the goods and the explanation offered is unsubstantiated, intent to evade duty may be inferred and confiscation with penalty sustained.

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