2007 (2) TMI 497 - AT - Central Excise

Summary

Issues:
1. Confirmation of demand of duty and penalty for removal of telephone sets without payment of duty.
2. Imposition of penalty for non-accountal of excisable goods manufactured by the respondents.

Analysis:

Issue 1: Confirmation of demand of duty and penalty for removal of telephone sets without payment of duty.
The adjudicating authority confirmed the demand of duty and imposed penalties for the removal of telephone sets without payment of duty. The Commissioner (Appeals) set aside the Adjudication order, leading the revenue to file an appeal against this decision. The Departmental Representative argued that the non-accountal of goods was admitted by the respondents, justifying the confiscation and upholding of penalties. Reference was made to the Tribunal's decision in the case of PNP Castings (P) Ltd. v. CCE, Lucknow, 2006. However, the advocate for the respondents supported the Commissioner (Appeals) findings, emphasizing that the goods were kept out of the bonding store room due to space constraints, with no evidence of an attempt to clear the goods clandestinely. Citing the Supreme Court's decision in Jain Irrigation Systems Ltd. v. CCE, 2006, and the Tribunal's decision in Bhillai Conductors (P) Ltd. v. CCE, Raipur, 2000, the advocate argued against the imposition of penalties.

Issue 2: Imposition of penalty for non-accountal of excisable goods manufactured by the respondents.
Upon review, the Commissioner (Appeals) found no evidence that the non-accountal goods were intended for removal without duty payment. The absence of any intention for clandestine removal was noted, aligning with the Supreme Court's ruling in Jain Irrigation System Ltd. case. The judgment emphasized that confiscation cannot be justified if there is no evidence of intent to take goods outside the factory premises. Consequently, the order of the Commissioner (Appeals) was upheld, and the appeal filed by the Revenue was rejected. The decision was pronounced in the open court, affirming the findings in favor of the respondents.