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2010 (1) TMI 409 - CESTAT, NEW DELHIConfiscation and penalty- When the officers visited the factory premises of the respondent company on 10-3-07 and conducted stock verification, the stock of finished goods was found tallied with the recorded balance. However, the stock recorded of raw materials namely, Flexi PU foam sheets/blocks was 14,102.11 Kgs. whereas the actual stock was 16,421 Kg. thus excess stock of 2318.89 Kgs. valued at Rs. 2,78,267/- involving Cenvat credit of Rs. 45,859/-was found and the same was seized. Show cause notice dated 9-7-07 was issued and the original authority after holding that unaccounted raw materials were kept for the purpose of manufacture of excisable goods without bringing into account and for removing clandestinely, confiscated the excess found raw materials under Rule 25 of the Central Excise Rules, 2002 but allowed the same to be redeemed on payment of fine of Rs. 55,000/-. He also imposed penalty of Rs. 45,000/- on the respondent company and Rs. 45,000/- on Shri Dinesh Godiyal, Deputy Manager of the respondent company. Commissioner (Appeals) held that inputs could not be confiscated under Rule 25 of the Central Excise Rules, 2002 and accordingly, set aside the order of the original authority. Held that- confiscation order upheld especially as excess of stock was substantial and dispute about manner of stock taking was raised belatedly. Imposition of penalty upheld under Rule 27 of Central Excise Rules, 2002.
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