RG 1 entry timing determines whether finished goods can be confiscated and penalised before clearance.

Finished plastic film goods found in the factory shortly after manufacture were not yet required to be entered in the RG 1 register because packing was completed later the same day. On those facts, and with no material showing intended removal without payment of duty, confiscation and penalty were not warranted. The goods would instead attract duty only upon clearance after proper recording in the statutory records.

---

---

Issues: Whether confiscation of finished plastic film goods and imposition of penalty were justified when the goods had not yet reached the stage for entry in the RG 1 register.

Analysis: The goods were found in the factory shortly after manufacture, and the recorded statement showed that packing was completed only later on the same day. On these facts, the goods had not attained the stage at which they were required to be entered in the statutory records. There was no contrary material to show that they were intended for removal without payment of duty. In the absence of such circumstances, confiscation and penalty were not warranted, and the goods would instead become liable to duty on clearance after proper recording.

Conclusion: Confiscation and penalty were not sustainable; the finding is in favour of the assessee.

---