TMI Blog1996 (11) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... espondents were not in fully finished form inasmuch as they had yet to be subjected to double bonding; that during that period their machine which was used for double bonding was not working; that the semi-manufactured stage of the product was evident from the fact that at the ends of PU Foam Sheet there was 20 meters of poplin cloth which is normally taken away before the goods are treated manufactured. The ld. Counsel submits that the practice in the trade by manufacturers of PU Foam Sheet was to take away poplin cloth from the ends to measure it and to fold it before it was recorded in RG 1 register. The ld. Counsel submits that admitted position was that poplin cloth was still stitched at the end of the PU Foam cloth; that it was neithe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... semi-finished form and had not attained the stage of recording them in RG 1 register. The ld. Counsel therefore prays that the confiscation of the goods was not warranted. 2. On the question of imposition of penalty the ld. Counsel submits that since the goods were not fully finished there was no question of recording them thus there was no violation of any provisions of the Central Excise Act or Rules framed thereunder. He submits that if at all it is presumed that the goods had reached the RG 1 stage or the allegation of non-accountal of the goods is proved then only rule under which an offence was punishable was under Rule 226 of the Central Excise Rules. In support of his contention the ld. Counsel cited and relied upon the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the firm in his statement admitted that the goods were fully finished. I find that the respondents in support of their contentions submitted that poplin cloth was still stitched at the end of the PU Foam Sheet and had requested for physical verification which was not permitted thus the dispute about finished stage continues. Having regard to the facts and circumstances I find that the balance of convenience is in favour of the respondents that the goods were still inside the factory that there were no preparations for clandestine removal of the goods. In the circumstances I uphold the impugned order setting aside confiscation of the goods. 5. On the question of imposition of penalty there are two provisions one is under Rule 173Q and the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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