1992 (10) TMI 165 - AT - Central Excise

Summary

Issues:
1. Appeal against rejection of applications by Collector of Central Excise, Bhubaneswar.
2. Determination of whether goods were cleared without payment of full duty.
3. Imposition of penalty under Rule 173Q(1)(a) for violation of Central Excise Rules.

Analysis:
1. The appeals were filed by the Collector of Central Excise, Bhubaneswar against the rejection of applications by the Collector (Appeals), Calcutta. The issue revolved around determining the legality of the decision taken by the Assistant Collector regarding the clearance of goods without payment of duty. Both appeals were disposed of together due to the similarity of issues involved.

2. The Collector (Appeals) and the Assistant Collector had differing views on whether the replenishment of the Personal Ledger Account before filing the monthly RT 12 return absolved the assessees from any wrongdoing. The Departmental Representative argued that clearing goods without sufficient balance in the account amounts to serious offense, regardless of subsequent replenishment. The Collector (Appeals) found that the shortage in duty payment was rectified before the RT 12 submission, leading to the rejection of the applications.

3. The appellate tribunal disagreed with the Collector (Appeals) and held that the clearance of goods without full duty payment constituted a violation of Central Excise Rules. The tribunal emphasized that the intention to evade duty is not a prerequisite for imposing penalties under Rule 173Q(1)(a). It was noted that the respondents had cleared excisable goods without adequate balance in the PLA, contrary to Rule 9(1), 173F, and 173G. The tribunal highlighted that compliance with these rules is mandatory and does not allow for post-clearance replenishment of the PLA.

4. In the second appeal, it was found that goods were cleared without payment of duty, leading to a duty involvement of Rs. 11,700. The tribunal emphasized that evidence of manipulation of records to evade duty was not necessary in such cases. The tribunal set aside the Order-in-Appeal and remanded the matter to the Assistant Collector for a fresh decision in accordance with the law and principles of natural justice.

5. In conclusion, the tribunal allowed both appeals, setting aside the impugned orders and remanding the matters for de novo decisions. It was established that the original decisions by the Assistant Collector were not proper, and the Collector (Appeals) erred in upholding them. The importance of compliance with Central Excise Rules, particularly regarding duty payment before goods clearance, was reiterated throughout the judgment.