Delayed D-3 intimation did not justify fresh duty on identifiable returned vehicles, though penalty survived for procedural lapse.

Delayed D-3 intimation for re-entry of motor vehicles did not, by itself, justify a fresh duty demand where the vehicles remained conclusively identifiable through chassis and engine numbers as the same goods earlier cleared. The purpose of the intimation is to link returned goods with their prior clearance, and that link was not broken on these facts, so the duty demand was not sustained. The procedural default was nevertheless treated as an irregularity, and penalty was upheld despite the setting aside of the duty demand.

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Issues: (i) Whether late submission of D-3 intimation for re-entry and subsequent clearance of identifiable motor vehicles justified a fresh demand of duty under Rule 173M of the Central Excise Rules, 1944. (ii) Whether penalty was sustainable in view of the delay in filing the D-3 intimation.

Issue (i): Whether late submission of D-3 intimation for re-entry and subsequent clearance of identifiable motor vehicles justified a fresh demand of duty under Rule 173M of the Central Excise Rules, 1944.

Analysis: The admitted position was that the D-3 intimation was not filed within time. However, the vehicles were uniquely identifiable by chassis numbers and engine numbers, and those particulars established that the goods received back into the factory were the same goods earlier cleared. Since the purpose of D-3 intimation is to link the goods with their earlier clearance, the delay did not defeat that identity in the present facts.

Conclusion: The fresh demand of duty was not justified and was set aside in favour of the assessee.

Issue (ii): Whether penalty was sustainable in view of the delay in filing the D-3 intimation.

Analysis: The delay amounted to an irregularity on the part of the assessee. The amount of penalty was not substantial, and the procedural lapse was sufficient to attract penalty despite the setting aside of the duty demand.

Conclusion: The penalty was sustained against the assessee.

Final Conclusion: The appeal succeeded on the duty demand but failed on the penalty, resulting in partial relief to the assessee.

Ratio Decidendi: Where goods are conclusively identifiable as the same goods earlier cleared, a delayed procedural intimation does not by itself justify a second levy of duty, though the related procedural lapse may still sustain penalty.

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