TMI Blog2005 (7) TMI 248X X X X Extracts X X X X X X X X Extracts X X X X ..... tiable, is totally uncalled for. On this ground alone, the Order passed by the ld. Commissioner, who upheld the Order of the lower authority, justifying the seizure made by his officers deserves to be set aside. Whereas the allegation in the Show Cause Notice, is about the non-accountal of the excess stock of goods, the ld. Commissioner, has held his Order that the assessee had cleared the goods without payment of duty as if the allegation was about shortage of goods, At more than one place, particularly in his Order, the ld. Commissioner had mentioned about the shortage of goods. This only shows total non-application of mind on the part of the ld. Commissioner, in passing his Order and on this ground alone, his Order-in-Appeal, deserves to be quashed. It is very clear that mere non-entry of the productions in the RG-1 will not bring in the liability to confiscation under provision of the Central Excise Rules if there is no corresponding material of clandestine clearance also available. Unaccounted production goes in tandem with clandestine removal and evidence of both has to be present in a given case to avoid the charge to be determined on an assumption/presumption. Applying the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufactured prior to 16-5-1997 and kept in packed condition. Besides, there were 8722 nos. of CD Audio which were manufactured in the first shift on 16-5-1997, part of which were kept in packed condition and the remaining in the process of being packed. These (8722 nos. of CD Audio) were not entered in the RG-1 Register as per the procedure being followed by them, which was also in accordance within instructions/clarifications issued by the Dept. was that each day's production was entered in the RG-1 Register, only at the end of the day. The applicants would have automatically entered these production figures of CD Audio, produced in the first shift on 16-5-1997 at the end of the day but the officers who were present in the factory premises from 3.30 pm to the midnight. And thereafter issued a notice alleges - (i) Confiscation of 44,661 nos. of CDs under Rule 173Q(1) of the Central Excise Rules, 1944 and penalty thereunder. (ii) Demanding duty on the price of Music companies sale prices for whom the CDs were being manufactured proposed recovery of Rs. 8,22,994/- under Section 11A(1) with interest. 2. The C.C.E. (A) found - I have carefully gone through the facts of the case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Collector - 1987 (27) E.L.T. 40 (AP) also since improper maintenance or non-maintenance of statutory records results in contravention of statutory records, mens rea is not essential for imposition of penalty (Nizam Sugar Factory v. Collector - 1987 (27) E.L.T. 40 (AP). It is even laid down that penalty is also imposable when on stock taking there is unexplained excess/shortage in the account books vis-a-vjs physical balance (Goodyear India v. Collector - 1990 (48) E.L.T. 394 (T). As such the imposition of penalty under Rule 173Q is quite legal and needs no interference. In the instant case, I find that though the goods in question were not entered in RG-1 register as required which is not at all disputed, infact it is admitted down the line right from both the partners in their statement as well as concerned staff dealing with excise in view of fact that 44,661 nos. of compact discs were totally ready goods, yet it was not entered in any statutory records even till 1-4-1997, the date of the visit by the officers to their unit further it was pointed out on 16-5-1997, by the officers were found unaccounted in their factory premises. So the burden of establishing that the goods wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1944. Since Shri Rajiv Agarwal, Director Shri G.D. Agarwal, Managing Director of the firms are responsible for these acts, of omission and commission they are liable for penalty under Rule 209A of Central Excise Rules, 1944. Hence these appeals. 3. After hearing both sides considering the material on record, it is found - (a) The applicants have brought on the record, additional Grounds, numbered as L, M, N O and are inserted after Ground 'K' of Grounds of Appeal already filed before this Tribunal. These additional grounds are submitted on the basis of the records already before the Addl. Commissioner/Commissioner (Appeals), which are also part of the Paper Book filed along with the Appeal Memorandum before this Tribunal. The same are accepted. On considering, it is held - (i) The ld. Commissioner of Central Excise (Appeals) has failed to peruse the relevant extracts of pages 1, 2, 71 72 of the RG-1 Register which were submitted to him as part of the Appeal Petition filed before him. It was his duty to go through these relevant documents, before passing his Order. Had the ld. Commissioner cared to go through these documents, he would have realized that the charge of n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee had cleared the goods without payment of duty as if the allegation was about shortage of goods, At more than one place, particularly in para 4 of his Order, the ld. Commissioner had mentioned about the shortage of goods. This only shows total non-application of mind on the part of the ld. Commissioner, in passing his Order and on this ground alone, his Order-in-Appeal, deserves to be quashed. (b) The law on confiscation of goods, in the factory and not entered in RG -1 production record is well settled. From the following decisions of the Bombay Andhra Pradesh High Courts of this Tribunal. (i) Southern Steels Ltd. v. U.O.I. - 1979 (4) E.L.T. (J 402) (A.P.) (ii) Kirloskar Brothers - 1988 (34) E.L.T. 30 (Bom.) (iii) Nalanda Tobacco - 1997 (91) E.L.T. 275 (A.P.) (iv) Bhilai Conductors Pvt. Ltd. - 2000 (125) E.L.T. 781 (Trib.) It is very clear that mere non-entry of the productions in the RG-1 will not bring in the liability to confiscation under provision of the Central Excise Rules if there is no corresponding material of clandestine clearance also available. Unaccounted production goes in tandem with clandestine removal and evidence of both has to be present in a given case t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
