TaxTMI 
TaxTMI 
2006 (5) TMI 13
X X X X Extracts X X X X
X X X X Extracts X X X X
....of Inverters and UPS and appellant No.2 i.e. SAR Silicon Pvt. Ltd., is a dealer of the goods manufactured by appellant No.1, while appellant No. 3 i.e. Shri M.L. Malhotra is a Director of appellant No. 2. The allegations against appellant No. 1 are that during the visit of their premises the officers found excess finished goods and excess raw materials as against the recorded balances in the statutory records. Allegations against appellant No. 2 is that he had procured dutiable excise goods without the proper duty paying document and has indulged in the activity of clandestine removal. A show cause notice was issued for the confiscation of the seized goods from both the appellants and penalty was also proposed to be imposed on them and also....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uential imposition of penalties and redemption fine on the noticees is sustainable under the central excise law. Purpose for keeping finished goods unaccounted and excess raw material is proved by recovering the clandestine removed goods outside the place of manufacture and in the premises of their dealer. So it is not mere a case of non-accountal of goods as intention of the appellants was to remove the goods without payment of duty keeping in view their past clearances made to their dealers and established by the Revenue by recovering such goods." 4. The findings of the appellate authority are not in consonance with the settled law. If the appellant has procured raw materials from a unregistered dealer and has not availed any Modvat cred....
X X X X Extracts X X X X
X X X X Extracts X X X X
....125) ELT 781 (Tri.). As regards the confiscation of the raw materials it is a settled law that such confiscation is not valid as they are not manufactured by the appellant. In view of this the confiscation of the goods of appellant No.1 are unsustainable and hence set aside. Since the confiscation is set aside the penalty imposed on the appellant No. 1 is also liable to be set aside. 5. As regards the appellant Nos. 2 & 3 I find that the appellate authority has not come to any findings in the order in appeal. The appellants produce before me the duty paying documents in respect of the goods found in the premises of appellant No. 2. The perusal of documents shows that the duty liability has been discharged on these goods. Since the lower au....