Statutory production records remain mandatory despite later captive-consumption exemption; confiscation and penalty were upheld for unentered dies.

Subsequent exemption for captive consumption did not relieve the assessee of the obligation to maintain statutory production records or account for dies at the time they were manufactured and found in stock. The dies were detained when no exemption was in force, and the record showed that only private records were maintained, with no entry in RG-1 or the daily production register. Because the matter turned on non-maintenance of statutory records rather than any confirmed duty demand, confiscation of the dies and the personal penalty were upheld.

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Issues: Whether steel dies found unentered in RG-1 could be confiscated and penalised merely because they were later exempted for captive consumption, and whether the later exemption displaced the obligation to maintain statutory production records when the goods were detained.

Analysis: The dies were detained in January 1995, when no exemption for such goods was in force. The record showed that the appellant maintained only private records and did not enter the manufactured dies in RG-1 or the daily production records. The later exemption for captive consumption from 16-3-1995 did not erase the obligation to account for production at the time the goods were manufactured and found in stock. Since the impugned order did not confirm any duty demand and proceeded on the basis of non-maintenance of statutory records, the confiscation and penalty were upheld.

Conclusion: The confiscation of the dies and the imposition of personal penalty were held justified, and the challenge failed.

Final Conclusion: The appeal was dismissed as the appellant's non-maintenance of statutory records at the relevant time supported confiscation and penalty, notwithstanding the subsequent exemption for captive captive use.

Ratio Decidendi: Subsequent exemption for captive consumption does not absolve an assessee from the obligation to maintain statutory production records and account for goods when they were manufactured and found in stock before the exemption took effect.

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