Custom, Excise & Service Tax Tribunal
Cce, Raipur vs M/S. Kwality Foundry Industries on 24 March, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST BLOCK NO. 2, R.K. PURAM, NEW DELHI COURT III EXCISE APPEAL NO. 23 OF 2007-SM [Arising out of Order-in-Appeal No. 168/RPR-I/2006 dated 5.9.2006 passed by the Commissioner (Appeals-I), Central Excise, Raipur] For approval and signature: Honble Mr. P.K. Das, Member (Judicial) 1. Whether Press Reporters may be allowed to see the order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair copy of the order? 4. Whether order is to be circulated to the Departmental authorities? CCE, Raipur Appellant Vs. M/s. Kwality Foundry Industries Respondent
Appearance:
Shri R.K. Verma, D.R. for the Revenue; Shri A. Jaju, Advocate for the respondents Coram:
Honble Mr. P.K. Das, Member (Judicial), Date of hearing/decision: 24th March, 2009 FINAL ORDER NO._________________ dated __________ Per P.K. Das:
Revenue filed this appeal against the order of the Commissioner (Appeals).
2. Heard both sides and perused the records. Relevant facts of the case, in brief, are that the respondents are engaged in the manufacture of various articles of Cast Iron. Central Excise officers visited the respondents factory on 11.3.2006 and conducted stock verification. Central Excise officers asserted shortage of finished goods as well as raw materials involving central excise duty of Rs. 1,05,687/-. Shri Pramod Vaswani, Director of the respondent company in his statement stated that they made the entry in the stock register on backward calculation and average rate basis and clearances were made on the basis of actual rate and, therefore, there is a difference in the stock. The respondents also debited the duty. The original authority confirmed the demand of duty and appropriated the amount as deposited by them. He has not imposed penalty under Section 11AC of the Central Excise Act, 1944. Revenue filed appeal before the Commissioner (Appeals) for imposition of penalty under Section 11AC of the Act which was dismissed by the Commissioner (Appeals).
3. Learned D.R. reiterates the grounds of appeal. He submits that the respondents failed to give satisfactory explanation for the shortage of the goods. It is presumed that the goods have cleared clandestinely.
4. After hearing both sides, I find myself unable to agree with the contention of the learned D.R. Honble Punjab & Haryana High Court in the case of CCE, Ludhiana vs. Omkar Steel Tubes (P) Ltd. has held that mens rea is essential for imposition of penalty under Section 11AC. In the present case there is no material that the respondents cleared the goods clandestinely. In view of that, I find no reason to interfere with the order of the Commissioner (Appeals). Accordingly, appeal filed by the Revenue is rejected.
(Dictated & pronounced in the Open Court.) (P.K. DAS) MEMBER (JUDICIAL) RK