TMI Blog1996 (6) TMI 258X X X X Extracts X X X X X X X X Extracts X X X X ..... acts of the case are that on an information that the appellants are indulging in suppression of production of excisable goods and clandestine removal thereof, a team of Central Preventive Officers headed by Supdt. (CP) visited the factory premises of the party on 10-7-1994 and conducted physical stock verification of the finished goods as well as raw materials. On physical verification, a quantity of 7.410 MT of Balls and Cylpebs of alloy steel valued at Rs. 1,85,250/- involving Central Excise duty to the tune of Rs. 27,787.50 was found in excess of the recorded balance in RG 1. A physical verification report to this effect was prepared on the spot which was duly signed by the General Manager (Works) of the factory. The said General Manager ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e had been arrived at as 47.5 kgs. and so on. They had stated that no weighment sheet/chart in respect of the weighment of each piece of the 32 Sl. Numbers had been made out, in support of the total weight of 48.036 MT allegedly found short by the officers. They stated that physical stock verification report dated 10-7-1994 the stocks from Sl. No. 2 to Sl. No. 8 were found in agreement when compared with the opening balance of 10-7-1994. Therefore, they stated that the department had adopted to standards in the case of finished goods. Therefore, they disputed about the excess of 7.410 MT is arbitrary and is not correct. They also submitted that no confiscation and fine could be leviable as the goods not meant for clandestine removal and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ording of the balance in the records. He submits that although penalty is imposable for improper maintenance of the records, as the goods were found in the bounded store room itself and in the absence of any evidence of clandestine removal or preparation made by the assessee for such removal or the goods not having been seized in such process of removal without payment of duty, therefore, the goods cannot be confiscated and hence imposition of penalty of Rs. 40,000/- involving duty amount of only Rs. 28,787.50 is not sustainable. In this regard, the Learned Advocate relied on several judgments cited in the order-in-original itself. He also relied on the judgment of the ratio of the following judgments :- 1. Garden Silk Mills v. Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 512 (Tri.) = 1995 (9) RLT 175 and in the case of Pooja Forge Pvt. Ltd. v. Collector of Central Excise as reported in 1996 (84) E.L.T. 37 (Tri.) = 1996 (64) ECR 248. In the case of Garden Silk Mills, the Tribunal held that the imposition of penalty is justified when the goods have been found to have not properly accounted for. However, in the absence of any clandestine removal as the goods are still within factory premises and no attempts for clandestine removal had been made, therefore, the Tribunal set aside the order of confiscation in the light of the judgment rendered in the case of Southern Steel Ltd. v. Union of India as reported in 1979 (4) E.L.T. (J 402). This citation and that of New Polymer Industries have been taken noted of in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice that the column 15 of RG 1 deals about the goods lying in finishing room. The Learned DR is correct in his submissions that the quantity lying in finishing room should have been entered into including the pending balance in column 2. As regards non-entering of balance in column 2, the Learned Consultant submitted that no balance was available as the same was being removed on the same date. If this be so, then the goods of 9-10-1992 were still remaining in factory on 10-11-1992. Hence this plea cannot be accepted. Therefore, it is clear that there has been non-entry in the RG 1 register in the manner in which it is required to be done. Therefore, the allegation of non-maintenance of register is upheld and hence I hold that the penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les. Further it was held that the party had even admitted about removal of the goods and the seized lorry was loaded with an unaccounted goods, well packed and ready for removal. Hence such goods were held to be confiscable as the assessee had also admitted to have removed those goods in a fully packed condition. In the present case there is no attempt made by the assessee to remove the goods as they were still lying in the finishing room. In that circumstances, applying the ratio of the Western Transformer Equipment (supra) and Garden Silk Mills, the confiscation and imposition of fine in respect of goods still lying in the finishing room is not sustainable and that portion of the order is set aside. With these modifications the other pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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