Custom, Excise & Service Tax Tribunal
M/S Kashi Laminators (P) Limited vs Cce, Lucknow on 3 September, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. IV Excise Stay Application No. 3607 of 2012 in Appeal No. 2873 of 2012 and Appeal No. 2872 of 2012 (SM) [Arising out of the Order-in-Appeal No. 275-276/CE/LKO/2012 dated 13/06/2012 passed by The Commissioner (Appeals), Customs & Central Excise & Service Tax, Lucknow.] For Approval and signature : Honble Shri Rakesh Kumar, Member (Technical) 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 : Department Authorities? M/s Kashi Laminators (P) Limited ] Appellant Shri Bhupesh Bansal, Managing Director ] Versus CCE, Lucknow Respondent
Appearance Shri R.M. Saxena, Advocate for the appellant.
Shri P.K. Sharma, Authorized Representative (DR) - for the Respondent.
CORAM : Honble Shri Rakesh Kumar, Member (Technical) DATE OF HEARING : 03/09/2013.
Final Order No. 57554-57555/2013 Dated : 03/09/2013 Per. Rakesh Kumar :-
M/s Kashi Laminators (P) Limited, the appellant company, are manufacturers of printed plastic laminate rolls, plastic bags etc. chargeable to excise duty under Chapter 39. Shri Bhupesh Bansal is the Managing Director of the appellant company. In course of visit by the DGCEI officers to the appellants unit on 20th October 2010, stock of the finished goods as well as raw material was checked. According to the officers there was excess stock of 194.4 kg. of finished product valued at Rs. 4,724/- and there was excess stock of inputs valued at Rs. 6,22,125/-. The excess stock of inputs as well as finished goods was placed under seizure. Subsequently, it was ordered to be confiscated by the Assistant Commissioner vide order-in-original dated 12/9/11 with option to be redeemed on redemption fine of Rs. 1,67,000/- and beside this, penalty of Rs. 5,000/- was imposed on Shri Bhupesh Bansal, Managing Director under Rule 26. On appeal being filed to Commissioner (Appeals), this order of the Assistant Commissioner was upheld vide order-in-appeal No. 275-276/CE/LKO/2012 dated 13/6/12 against which these two appeals have been filed. In respect of appeal filed by Shri Bhupesh Bansal, the stay application is still pending.
1.1 Though in respect of appeal filed by Shri Bhupesh Bansal, the matter is listed only for listed for hearing of stay application, since, the appeal filed by main appellant is also listed for final hearing, after hearing of this matter for sometime, the Bench of the view that the appeal filed by Shri Bhupesh Bansal can also be taken up for final disposal. Accordingly, the requirement of pre-deposit of penalty by Shri Bhupesh Bansal is waived and his appeal is also heard for final disposal alongwith the appeal filed by M/s Kashi Laminators (P) Ltd.
2. Heard both the sides.
3. Shri R.M. Saxena, Advocate, the learned Counsel for the appellant, pleaded that there was no excess of stock of inputs finished goods, that the weight of the finished goods as well as inputs has been determined by eye estimation and, as such, there was no weighment, that Tribunals in the case of Hans Metals Pvt. Ltd. vs. CCE, Kanpur reported in 2006 (199) E.L.T. 521 (Tri. Del.) has held that confiscation of the alleged excess stock of finished goods is not sustainable, when the weight had been determined by eye estimation without actual weighment, that in any case major portion of the value of the confiscation goods is of inputs in respect of which there is no provision for confiscation, that in this regard, he relies upon the judgment of the Tribunal in the case of Unimark Remedies Ltd. vs. CCE, Vapi reported in 2006 (204) E.L.T. 49 (Tri. Mumbai), wherein it was held that there is no provision in Central Excise law for confiscation of unaccounted raw material, that at the time of the officers visit to the factory, the appellants unit was under full duty exemption and, hence, for non-maintenance of proper records, the goods were not liable for confiscation and penalty could not be imposed and in this regard he relies upon the Tribunals judgment in the case of Taxel Bearings vs. CCE & C, Rajkot reported in 2007 (213) E.L.T. 517 (Tri. Ahmd.), and that in view of this, the impugned order upholding the redemption fine and penalty on the appellant is not sustainable.
4. Shri P.K. Sharma, the learned Departmental Representative, defended the impugned order by reiterating the findings of the Commissioner (Appeals) and emphasised that since at the time of the visit of the DGCEI officers to the factory, the appellant had Central Excise registration, they were required to maintain the correct account of the finished goods manufactured by them and also the account of raw material. He also emphasised that the nature of the goods was such that their weight could be determined by counting the packs without actual weighment. He, therefore, pleaded that there is no infirmity in the impugned order.
5. I have considered the submissions from both the sides and perused the records.
6. So far as the confiscation of the inputs valued at Rs. 6,22,125/- is concerned, even if the same were not correctly accounted for in the appellants record, there is no provision for confiscation of such alleged unaccounted inputs under Rule 25 and imposition of penalty on this count. I find that on this point, the Tribunal in the case of Unimark Remedies Ltd. vs. CCE, Vapi (supra) hold that for non-accounted of inputs confiscation of inputs and imposition of penalty is not sustainable. In view of this, I hold that the confiscation of inputs for non-accounted and imposition of penalty on this count is not sustainable.
7. As regards the confiscation of the finished goods valued at Rs. 44,744/- for alleged non accountal, there is no dispute that allegation of excess stock of finished goods is based on determination of weight by visiting officers who had not determined by actual weighment. Since, there was no actual weighment, there may be some variation between the estimated weight and the recorded weight and, as such, in my view, the confiscation of finished goods valued at Rs. 44,744/- and imposition of penalty on this count. Since neither the seized inputs nor the seized finished goods are liable for confiscation, there is no justification for penalty on Shri Bhupesh Bansal under Rule 26 of the Central Excise Rules, 2002 is also not sustainable.
8. In view of the above discussion, the impugned order is not sustainable. The same is set aside. The appeals as well as stay application filed by Shri Bhupesh Bansal are allowed.
(Pronounced in the open court.) (Rakesh Kumar) Member (Technical) PK ??
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