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2023 (12) TMI 474 - AT - Central ExciseClandestine removal - Confiscation of seized goods - Levy of redemption fine and penalties - ingots and angles found excess in the premises of the factory without any entry in the statutory records. Confiscation of goods - Redemption fine - HELD THAT:- There is no doubt that some stock was found in excess over the declared stock and were not found entered in the daily stock account of the appellant, but whether or not it was a deliberate act of the appellant within intent to remove the unrecorded goods without issue of invoice or without payment of duty has to be decided based on cogent evidence. This burden needs to be discharged by the Department. Whether a mere violation of Rule 10 of the Central Excise Act amounts to deliberate intention to evade is again to be proved by the Department - there is no such evidence which has been led by the Department - Even improper accounting is denying the mean clandestine removal, in the absence of circumstantial evidence proving the same. In view of the above, the redemption fine imposed on the goods set aside. Imposition of penalty on appellant No. 1 - HELD THAT:- The essential ingredient that is required to be satisfied for invoking Section 11AC and Rule 25(1) is suppression, collusion etc. which has to be established with an intent to evade payment of duty. In the instant case, it is noted that excess quantity of MS Ingots and MS Angles were found which had not been entered in the statutory books, which is liable for penalty. However, other than the statement, no other corroborative evidence has been brought on record to show that there was an intent to evade. There is also no evidence brought out to establish that the appellant No.1 had indulged in similar evasion earlier - the Learned Counsel has submitted that no malafide intention of clandestine removal of excess goods had been established, and sufficient corroborative evidence has not been established to prove the intention to evade. This contention is agreed upon. Tribunal in the case of NILESH STEEL & ALLOYS PVT. LTD. VERSUS COMMR. OF C. EX., AURANGABAD [2008 (3) TMI 572 - CESTAT, MUMBAI] observed that penalty should not have been imposed merely because the stock of finished goods are found in the factory without entry in the production register especially, when there is no evidence of clandestine removal. In view of the above settled position, the levy of penalty under Rule 25(1) on the appellant in the instant case cannot be upheld. It is noted that the essential ingredients to invoke this Rule is if the person is involved in actual evasion or abets in any manner is consequently liable for penalty. No such evidence is brought on record to support the imposition of penalty under this Rule - it is noted that this Tribunal had in the case of Carpenter Classic Exim Pvt. Limited [2005 (12) TMI 185 - CESTAT, BANGALORE] had taken a view that personal penalty on the employee need not be imposed as he is acting under the direction of his employer - In the case in hand, there is nothing on record to show that the employee had benefitted by the activities of the appellant No. 1 during the visit of the officers. Therefore, the penalty imposed on appellant No.2 is set aside. The impugned order set aside - appeal allowed.
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