Customs, Excise and Gold Tribunal - Calcutta
Kripal Springs (India) Ltd. vs Commissioner Of Central Excise on 19 June, 2003
Equivalent citations: 2003(156)ELT768(TRI-KOLKATA)
ORDER Archana Wadhwa, Member (J)
1. After dispensing with the condition of pre-deposit of penalty, I take up the appeal itself inasmuch as the issue is covered by the Larger Bench decision of the Tribunal.
2. Vide the impugned order, the authorities below have confiscated 5.7 tons of iron spring leaves found in excess in the appellants' factory at the time of their visit of the officers with an option to redeem the same on payment of redemption fine of Rs. 1,20,000/-. In addition, personal penalty of Rs. 10,000/- has also been imposed.
3. Shri B.J. Mookherjee, ld. Advocate appearing for the appellants, reiterates the same reasoning which has been pleaded before the authorities below. It is contended that the difference in stock is not real but pseudo inasmuch the procedure adopted by the appellants is that the weight of large size spring leaves is determined on the basis of weight chart whereas that a small size of spring leaves is determined by the actual weight. When there is a mixed production, the entire weight is determined by actual weighment but the weight of the despatched goods is determined on the basis of weight chart. It has also been contended that in any case the difference is to the tune of 3.2% and the ISI norms allows tolerance of weight to the tune of ± 5%. As such the difference is within the tolerance limit prescribed by the Bureau of Indian Standard of Flats.
4. In any case submits the ld. Advocate that there is a finding by the Commissioner that there is no evidence to show that non-accountal of goods were kept with an intention to evade payment of duty. In spite of that, the appellate authority has upheld the confiscation of the goods and imposition of personal penalty upon the appellants. Ld. Counsel submits that the issue is no more res integra and has been decided by the Larger Bench decision of Tribunal in the case of Bhillai Conductors (P) Ltd. v. CCE, Raipur reported in 2000 (125) E.L.T. 781 (Tri. - LB) = 2000 (91) ECR 569 (Tri. - LB) wherein it has held that in the absence of mens rea on the part of the appellants, neither confiscation of excess goods nor imposition of penalty on the appellants was sustainable and penalty of Rs. 2,000/- is imposable under Central Excise Rule 226. The above decision has been followed by the Bangalore Bench of the Tribunal in the case of Canara Steel Ltd. v. Commissioner of Central Excise-III, Bangalore reported in 2001 (129) E.L.T. 616 (T) = 2001 (45) RLT 903 (CEGAT - Bang.).
5. I have also heard Shri A.K. Mondal, ld. SDR for the Revenue.
6. There is a clear findings of the appellate authority that ....... "In the instant case, I cannot find any evidence produced by the department or even any allegation is made that the unaccounted for goods were kept with an intention to evade payment of duty". He has further observed that in such case Rule 226 provides for action for non-maintenance of books of accounts but the said Rule has since been repealed with effect from 12-5-2000 and inasmuch as the appellant has contravened the provisions by not maintaining records properly, penalty is imposable under Rule 173Q(1)(b). However, I find that the appellants have given sufficient plausable explanation for the excess found material not entered in RG-I records, which explanation is in accordance with ISI standard. By allowing tolerance on the weight of leaves, I find that the excess weight in fact, was notional than real. In the circumstances, I find no justification in confiscation of the goods or for imposition upon the appellants. Impugned order is set aside and the appeal is allowed with consequential relief to the appellants. Stay petition also gets disposed of.