1990 (6) TMI 148 - AT - Central Excise

Summary

Issues Involved:
1. Demand of duty for the period beyond 20th August 1985.
2. Legality of penalty imposed.

Issue-wise Detailed Analysis:

1. Demand of Duty for the Period Beyond 20th August 1985:

The appellants challenged the demand of duty amounting to Rs. 33,494/- for the period of 1985-86, arguing that the original proceedings and evidence pertained only up to 20th August 1985. The Tribunal noted that the initial show cause notice issued on 5-9-1985 covered the period from September 1982 to May 1983 and April 1985 to August 1985. The demand for this period was ultimately confirmed by the Collector (Appeals) in an order dated 29-02-1988, which reached finality.

The appellants contended that no fresh evidence had been presented to justify the demand for the period beyond 20th August 1985. They highlighted that the match units were under physical control of the Department, and any irregularities post-20th August 1985 would have been detected by the officers during their visits. The Tribunal found merit in this argument, noting that the facts and evidence cited in the subsequent show cause notice dated 22-9-1988 were identical to those in the earlier notice, with no new evidence provided for the period after 20th August 1985.

The Tribunal concluded that in the absence of any substantive evidence of clandestine clearance of matches after 20th August 1985, the demand for duty for this period could not be sustained. Consequently, the order demanding duty for the period beyond 20th August 1985 was set aside.

2. Legality of Penalty Imposed:

The penalty of Rs. 1,000/- was initially imposed for violation of Rule 53, under Rule 210 of the Central Excise Rules, 1944, and was confirmed by the Collector (Appeals) in the order dated 29-02-1988. The appellants had already paid this penalty, and it was not challenged further.

However, the Tribunal noted that since the charge of clandestine removal of matches after 20th August 1985 was not sustainable due to lack of evidence, the basis for imposing any additional penalty also did not exist. The Tribunal emphasized that no further proceedings could be drawn for the period before 20th August 1985 as the matter had already been concluded by the appellate authority's order.

Therefore, the Tribunal set aside the additional penalty imposed in the impugned order, maintaining that the penalty of Rs. 1,000/- already paid by the appellants was sufficient and no further penalty was warranted.

Conclusion:

The appeal was allowed, and the order demanding duty for the period beyond 20th August 1985, as well as the additional penalty, was set aside. The Tribunal upheld the finality of the duty demand and penalty for the period up to 20th August 1985 as per the appellate authority's order dated 29-02-1988.