2011 (1) TMI 633

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....ed by M/s Intermed using the imported raw materials of the appellant duty free without any permission from the statutory authorities and balance quantity valued at Rs.5,18,269/- was found to have been marked as marketed by M/s Cadila Healthcare Ltd., Ahmedabad manufactured in August/September 2000 but has not been accounted till the date of search on 5.4.02. After adjudication and appellate proceedings, the goods under seizure have been confiscated to the Government and allowed to be redeemed on payment of fine in lieu of confiscation of Rs.4,15,000. In addition, Central Excise duty of Rs.53,803/- on finished products with interest has also been demanded with penalty equal to the duty and penalty of Rs.15,000/- under Rule 26 of Central Exci....

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....confiscation of the goods, imposition of penalty is not warranted. No duty is payable on the raw material procured by them. Learned SDR reiterated the reasoning adopted by the Commissioner (Appeals) in his order to sustain the order-in-original. 3. We have considered the submissions made by the learned advocate.   4. Learned Advocate submitted that the goods were actually manufactured by M/s Lacure Pharmaceuticals on behalf of M/s Intermed. However, we find that according to the statement of Shri Mahendra Mule, looking after the matters relating to Central Excise, M/s Intermed is a loan licencee and had manufactured goods by using the raw material imported duty free by the appellant M/s Lacure Pharmaceuticals. He had also admitte....

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.... appellant. It was argued that mere non-accountal of the goods cannot render the appellant to confiscation. If the intention was to clear the same without payment of duty, such goods would not have been kept in the factory for such a long time. However, so far as accounting of the goods in the daily stock account is concerned, it is a mandatory requirement and failure to do so would render the goods liable to confiscation. However, we take note of the fact that ultimately all the goods have been exported and goods were lying in the factory for long time though unaccounted. Neither any valid reason has been offered by the appellant nor is there any investigation, leading to the conclusion of any malafide intention by the Revenue. Under these....