Commissioner of Central Excise Vs. Agya Auto Ltd.

Commissioner of Central Excise vs Agya Auto Ltd.

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi Decided Jan 19, 2004

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Citation: sooperkanoon.com/33842
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi
Judge: P Bajaj
Decided On: Jan 19, 2004
Subject: Excise

Case Summary

AI-generated summary - not the official court judgment text.

Excise

Key legal issue: Excise

Parties & Advocates

Appellant / Petitioner

Commissioner of Central Excise

Respondent

Agya Auto Ltd.

Legal References

Reported In: (2004)(166)ELT177TriDel

Excerpt

.....order-in-original of the assistant commissioner by setting aside the confiscation of the unaccounted goods, redemption fine imposed for getting those goods redeemed and converted the penalty under rule 226 of the rules from that of rule 173q.3. the facts borne out from the record are, that the respondents are engaged in the manufacture of leaf spring. on physical verification of the goods lying in their factory by the central excise officer, on 15-10-97, 367 nos. of leaf spring valued at rs. 73,400/- were found in excess over the balance recorded in the rg-i register. the goods were accordingly seized. after serving show cause notice on the respondents, the adjudicating authority ordered the confiscation of the goods, imposed redemption fine of rs. 20,000/- besides penalty of rs. 5,000/-under rule 173q.3. the learned commissioner (appeals) through impugned order, by relying upon the ratio of law laid down in bhilai conductors (p) ltd. v. cce, raipur - 2000 (125) e.l.t. 781, has set aside the confiscation of the goods, redemption fine as well as penalty under rule 173q. he has imposed penalty of rs. 2,000/- under rule 226.4. in the cross objections the respondents have only alleged that the entire case has been based on the assumption and presumptions as the entire leaf springs were lying in the shop floor of she factory. but they have not mentioned that these leaf spring were entered in the rg-i. they in fact did not dispute the non-accountal of goods in the statutory record before the authorities below. even the learned commissioner (appeals) in the impugned appeal has held that goods were found unaccounted.5. in kirloskar brothers ltd. v. union of india - 1988 (34) e.l.t. 30 it has been held by the hon'ble bombay high court that even in the case of non- accountal of goods, the provisions of rule 173q can be invoked and confiscation of the unaccounted goods can be ordered. the presence of mens rea on the part of the assessee is not required to be proved.the law.....

Full Judgment

1. None has come present on behalf of the respondents. They have requested that matter may be decided on merits by taking into consideration their cross objections. Therefore, I proceed to decide the appeal after going through the cross objections and hearing ld.JDR.2. In this appeal the Revenue has questioned the validity of the impugned order-in-appeal vide which the Commissioner (Appeals) has modified the order-in-original of the Assistant Commissioner by setting aside the confiscation of the unaccounted goods, redemption fine imposed for getting those goods redeemed and converted the penalty under Rule 226 of the Rules from that of Rule 173Q.3. The facts borne out from the record are, that the respondents are engaged in the manufacture of leaf spring. On physical verification of the goods lying in their factory by the Central Excise Officer, on 15-10-97, 367 Nos. of leaf spring valued at Rs. 73,400/- were found in excess over the balance recorded in the RG-I register. The goods were accordingly seized. After serving show cause notice on the respondents, the adjudicating authority ordered the confiscation of the goods, imposed redemption fine of Rs. 20,000/- besides penalty of Rs. 5,000/-under Rule 173Q.3. The learned Commissioner (Appeals) through impugned order, by relying upon the ratio of law laid down in Bhilai Conductors (P) Ltd. v. CCE, Raipur - 2000 (125) E.L.T. 781, has set aside the confiscation of the goods, redemption fine as well as penalty under Rule 173Q. He has imposed penalty of Rs. 2,000/- under Rule 226.

4. In the cross objections the respondents have only alleged that the entire case has been based on the assumption and presumptions as the entire leaf springs were lying in the shop floor of She factory. But they have not mentioned that these leaf spring were entered in the RG-I. They in fact did not dispute the non-accountal of goods in the statutory record before the authorities below. Even the learned Commissioner (Appeals) in the impugned appeal has held that goods were found unaccounted.

5. In Kirloskar Brothers Ltd. v. Union of India - 1988 (34) E.L.T. 30 it has been held by the Hon'ble Bombay High Court that even in the case of non- accountal of goods, the provisions of Rule 173Q can be invoked and confiscation of the unaccounted goods can be ordered. The presence of mens rea on the part of the assessee is not required to be proved.

The law laid down in this case has been overlooked by the Commissioner (Appeals). He has in my view wrongly applied the ratio of law laid down in the Bhilai Conductors case (supra). He has wrongly also converted the penalty under Rule 226, from Rule 173Q. He has even ignored the fact that even under Rule 226 also, confiscation of unaccounted goods has been provided. Therefore, while converting the penalty under said rule the Commissioner (Appeals) was duty bound to maintain the confiscation of the goods as ordered by the adjudicating authority.

Therefore, looking from any angle, the impugned order passed by the Commissioner (Appeals) cannot be sustained and the same is set aside.

The order-in-original of the adjudicating authority is restored. The appeal of the Revenue is allowed and cross-objections of the respondents are dismissed.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Delh... Same Parties Commissioner of Central Excise vs Agya Auto Ltd. Same Subject Excise Same Judge P Bajaj