2008 (11) TMI 178

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....-2-05 officers attached to the Central Excise division, Kovilpatti, intercepted a van of RCPL on its way to Kovilpatti. The vehicle was found laden with 4000 kgs of potassium chlorate in 80 bags of 50 kgs each. On enquiry, the driver of the vehicle Shri K. Vairakani produced an invoice No. 190, dated 5-2-05 for 1000 kgs in 20 bags issued by RCPL. The removal of 3000 kgs in 60 bags was not covered by any transport document/duty paying document with the driver or Shri S. Mohan, Supervisor at RCPL who travelled in the van. Thereupon the vehicle and the 4000 kgs of potassium chlorate were seized. Statements recorded from Shri K. Vairakani and Shri S. Mohan disclosed that the goods were bound for M/s. S.R. Agencies, Kovilpatti. An invoice No. 19....

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....ani, the driver employed by RCPL under Rule 26 of CER. He found 3000 kgs. of potassium chlorate liable for confiscation under Rule 25 of CER and ordered a fine of Rs. 9000/- towards its value as the goods had been released provisionally against bond and security. A fine of Rs.10,000/- was ordered to be appropriated towards the value of the vehicle found to have been liable for confiscation and released provisionally against bond and security. The vehicle was confiscated under Section 115(1) of the Customs Act, 1962. In the impugned order, the Commissioner (A) sustained the order of the original authority in toto. 2. In the appeal before the Tribunal, the impugned order is assailed on the basis that the original authority's finding that inv....

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....s of potassium chlorate by RCPL. No discrepancy was found at the factory premises or depot premises of the assessee on inspection by the departmental authorities. The proceedings were based on the presumption that invoice No.191 had actually been prepared on 6-2-05. This was not established. In any case, the fine of Rs. 9000/- towards the value of 3000 kgs of potassium chlorate found liable for confiscation and Rs.10000/- ordered as fine towards the value of the vehicle which carried the consignment of potassium chlorate were excessive. He prays that the amounts of fine ordered may be reduced considering the totality of the facts in case his plea that 3000 kgs of potassium chlorate had not been cleared without payment of duty was not accept....

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....508 (Tri.-Mum.), wherein it was held that "the Managing Director of a factory is fully responsible for ensuring the compliance to law and direction issued in writing and the penalty on the Managing Director is required to be upheld". It has to be held that the Managing Director of RCPL knew the requirement to issue invoice when goods are cleared from the factory. As he was concerned in removing/transporting 3000 kgs of potassium chlorate without cover of invoice in contravention of provisions of Rule 11 ibid, he had dealt with the goods, knowing that they were liable for confiscation. The act of appellant No. 2, attracted penalty under Rule 26 ibid. Rule 26 ibid is produced below:- "Rule 26 - Penalty for certain offences - Any person who a....