Rule 173B compliance and branded goods manufacture timing failed to justify confiscation or penalty.

Confiscation and penalty under the Central Excise Rules were unsustainable because non-compliance with Rule 173B was not proved on the record. The relevant declaration could be filed within 30 days from the date of change, and there was no documentary evidence that the branded goods were manufactured beyond the permissible period before detection. The date of detection was treated as the relevant reference point, so the alleged breach failed. Rule 226 was also found inapplicable to the facts, leaving no basis for confiscation or penalty.

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Issues: Whether confiscation of goods and penalty were sustainable when the alleged non-compliance with Rule 173B was not supported by evidence that the goods bearing the brand name were manufactured beyond the permissible period, and whether Rule 226 was attracted.

Analysis: The only relevant compliance requirement was the filing of a declaration under Rule 173B of the Central Excise Rules, 1944. On the record, there was no documentary evidence to show that the branded goods were manufactured more than 30 days before detection. Since a declaration under Rule 173B could be filed within 30 days from the date of change, the date of detection was treated as the relevant reference point, and the alleged breach was not proved. Rule 226 was also examined and found inapplicable to the facts.

Conclusion: Violation of Rule 173B was not established, confiscation and penalty were unsustainable, and the appeal was allowed in favour of the assessee.

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