TMI Blog2001 (6) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... ied to certain customers in Calcutta, Indore and Bangalore on the ground that these were non-duty paid. Option was, however, given for the redemption of these confiscated goods subject to payment of fine in lieu of confiscation. 2.The appeal of M/s. Maxon Engineering (P) Ltd. was decided by Order No. 1028/1998, dated 29-5-1998 by the Tribunal who vide the said order held : ".....the penalty and the demand of duty for the items other than Annexures C and H. The finding in respect of these two Annexures C and H are set aside and the matter remanded for de novo decision after giving the opportunity of personal hearing. The correctness of the amounts of duty involved may be checked by the adjudicating authority." 3.The present appeal has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the decision in Decent Dyeing - 1990 (45) E.L.T. 201, wherein it is held that buyers are not required to ascertain whether the excise duty has already been paid as they have no means of knowing it. By their own admission, M/s. MEPL have removed the said machinery, without payment of duty and hence, the seized goods and the goods found at the premises of M/s. Filare, Calcutta are liable for confiscation. As the machinery are seized from the purchasers premises, I am inclined to impose a fine in lieu of confiscation under the provisions of Section 34 of Central Excises Salt Act, 1944." and they were allowed on Rs. 1,75,000/- as redemption fine payment, in lieu of confiscation, under Section 34 of the Central Excises and Salt Act, 1944. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of notification, after availing Modvat credit and confusion about the rate of duty applicable in the beginning of such shift to Modvat had caused the alleged violation. This has been considered by the Collector to be the reason, which has induced him to impose a penalty of Rs. 20,000/- only on the manufacturer for these goods and other goods removed when he was primarily responsible for the payment of duty. However, the same reason, for treatment of leniency, has not been considered by him for an innocent buyer. He found a reason for confiscation and imposition of heavy redemption fine i.e. almost 100% of duty, involved, which was already paid. Therefore, we can not find any justification for the high amount of redemption fine as imposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules, we find :- (i) Rule 9(2) casts a duty penalty and confiscation liability on goods removed clandestinely in contravention of Rule 9(1). Since goods have been removed on Gate Passes showing RG23A, Part II, debit entry numbers. No confiscation arises under this rule for the goods in question. (ii) Rule 52 is applicable to other than SRP manufacturers and the present manufacturer is governed by Rule 173A and Chapter VII-A of the Rules. There can be no violation of the said Rule 52 in this case. (iii) Rule 52A prescribes the procedure for preparation of a Gate Pass in the case of failure to prepare the same, risks confiscation liability. Admittedly in the case before us gate passes were prepared as prescribed under Rule 52A. There is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds. The rule makers have not fixed such a liability of confiscation on goods 'Removed' or have defined the terms 'Removes' used in the rule. The term 'Removes' used is present continuous tense. It will not cover past acts of goods 'removed' and the action of 'removes' will come to an end, when the act is complete. The act of 'Removes' under Rule 173Q1(a) begins, when goods are shifted from the place of manufacture and shall necessarily cease on reaching another place of delivery, after its leaving the factory gate and any change of ownership, as buyer is not covered by Rule 173Q(1). Therefore, liability of confiscation under Rule 173Q(1)(a) on a manufacturer is a continuous liability, till, 'removes' is completed and does not lie after comp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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