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2013 (4) TMI 218 - CESTAT, NEW DELHIUnaccounted goods – Confiscation and Penalty - The respondents are manufacturers of various products of mild steel. - Central Excise visited the factory of the respondents and conducted verification of physical stock as compared to accounted stock and found discrepancies and proposed confiscation of goods found in excess and also demanding duty on the goods found short. Held that - In the case of unaccounted goods seized the adjudicating authority has not imposed any penalty under Section 11AC. So tribunal limit the examination of the issue to the question whether penalty provisions of Rule 25 will apply in the facts of the case. - respondents were liable to pay duty on the goods considering the quantum of goods already cleared in the financial year. When at such stage the goods are not recorded in account books and are found in the premises of the factory, the presence of the goods is not satisfactorily accounted for. So the goods are liable to confiscation under Rule 25 and also liable to pay penalty under Rule 25 and thus uphold the confiscation of goods found in excess of recorded stock. However tribunal reduce the redemption fine. In the matter of finished goods found short, tribunal is of the view that in the facts and circumstances of the case the finished goods recorded in books but not found have to be considered as cleared without payment of duty. So the demand for duty is maintainable. Further penalty equal to duty involved is imposable under provisions of Section 11AC of the Act. However tribunal give an option to the respondent to pay 25% of this duty amount within 30 days of receipt of this order for final closure of the matter as per provisions in Section 11AC of the Act. The appeal filed by Revenue is allowed partially.
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