M/S. Hariom Silk Mills Jayesh Vs. Commissioner of Central Excise - Court Judgment

Excerpt:
1. these two cases were posted for admission and for hearing the stay applications. on hearing shri saiyed for the applicants and smt. arya for the revenue i find that the issue being small, the appeals themselves could be taken up for disposal. this was done after granting waiver of predeposit of penalty of rs.25,000/- on the mills and of rs. 16,000/- on shri jayesh rameshchandra gandhi, partner thereof.2. during a visit of the central excise officers to the mills, excess of goods over their rg-1 balance was noticed.these goods were seized.they were provisionally cleared on bond. in adjudication proceedings these goods were confiscated but were granted redemption on payment of fine and penalty. shortage of goods valued rs.4,24,050/- was noticed.duty amounting to rs. 42,405/- on this amount was confirmed. penalty aforementioned was imposed.the commissioner (appeals) having upheld this order the present appeals are filed.3. shri saiyed submits that in the absence of any preparation for surreptitious removal of the excess goods their confiscation was not warranted. i do not find any force in the submission. in identical circumstances the tribunal had upheld such confiscation [1999 (111)elt 512].4. as regards the surreptitious removal i find that the managing director has not only admitted such removals but had also deposited the duty leviable thereon.there actions of the managing director indicated that the duty was evaded by the unit in a mala fide manner.5. shri saiyed, however, refers to and relies upon a tribunal judgment in the case of harish silk industries and others vs. cce order no.3575-75/wzb/2000 dated 9/10/2000 in which the tribunal in their interim order observed that penalty on the partnership firm and on the partner simultaneously was not warranted. since the partner had accepted the guilt there is no scope for remission of penalty imposed upon the mills. but in view of the cited judgment the penalty imposed upon the mills is remitted in full.

Judgment:
1. These two cases were posted for admission and for hearing the stay applications. On hearing Shri Saiyed for the applicants and Smt. Arya for the Revenue I find that the issue being small, the appeals themselves could be taken up for disposal. This was done after granting waiver of predeposit of penalty of Rs.25,000/- on the mills and of Rs. 16,000/- on Shri Jayesh Rameshchandra Gandhi, partner thereof.

2. During a visit of the Central Excise officers to the mills, excess of goods over their RG-1 balance was noticed.These goods were seized.

They were provisionally cleared on bond. In adjudication proceedings these goods were confiscated but were granted redemption on payment of fine and penalty. Shortage of goods valued Rs.4,24,050/- was noticed.

Duty amounting to Rs. 42,405/- on this amount was confirmed. Penalty aforementioned was imposed.The Commissioner (Appeals) having upheld this order the present appeals are filed.

3. Shri Saiyed submits that in the absence of any preparation for surreptitious removal of the excess goods their confiscation was not warranted. I do not find any force in the submission. In identical circumstances the Tribunal had upheld such confiscation [1999 (111)ELT 512].

4. As regards the surreptitious removal I find that the Managing Director has not only admitted such removals but had also deposited the duty leviable thereon.There actions of the Managing Director indicated that the duty was evaded by the unit in a mala fide manner.

5. Shri Saiyed, however, refers to and relies upon a Tribunal judgment in the case of Harish Silk Industries and Others Vs. CCE order No.3575-75/WZB/2000 DATED 9/10/2000 in which the Tribunal in their interim order observed that penalty on the partnership firm and on the partner simultaneously was not warranted. Since the partner had accepted the guilt there is no scope for remission of penalty imposed upon the Mills. But in view of the cited judgment the penalty imposed upon the mills is remitted in full.