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2016 (12) TMI 1381 - AT - Central ExciseEnd use of product - polyester texturised yarn - 100% EOU - goods detained on the belief that the same were diverted to open market instead of being sent to M/s RTPL, a 100% EOU for its use - whether confiscation of the goods seized by the Department and imposition of penalty on the Appellant are proper or otherwise? - Held that: - even though the goods were cleared against AR-3As, but instead of its further use by M/s RTPL, diverted on its way - the Appellants are required to pay the duty involved - it is not necessary always to prove mens rea on the part of the Appellant, also the Appellant has not disputed their liability of duty on the goods cleared by them from the factory against AR-3As which ultimately had not reached the destination, where these goods were to be used by M/s RTPL, In these circumstances, there is contravention of the provisions of the Central Excise Act and rules made there under - confiscation and penalty directed under Rule 9(2) read with Rule 209(1) of erstwhile Central Excise Rules 1944, are sustainable. However, the redemption fine and penalty imposed are excessive under the circumstances of the case. Consequently, considering the fact that the Appellant is a registered unit, the appropriation of entire Bank Guarantee amounting to ₹ 4,10,799/- on confiscation of goods is modified by reducing the fine to ₹ 1.00/- and penalty to ₹ 4.00 lakhs to meet the ends of justice - Further nothing has been brought on record by the Revenue to show that the Appellant is a habitual offender, warranting harsh action of confiscation of plants and machinery, confiscation of plants and machinery is set aside. Appeal allowed - decided partly in favor of appellant.
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