CX - Unaccounted finished goods - Tribunal has already taken lenient view and reduced RF, penalty: HC
By TIOL News Service
AHMEDABAD, MAR 04, 2017: THE case is that finished goods in excess of that mentioned in statutory records were found in the premises of the assessee and the excess stock could not be explained by the persons concerned. Therefore, the goods found in excess weighing 29.500 MTs valued at Rs.19,64,000/- were placed under seizure. Later, SCN was issued proposing confiscation of the seized goods and imposition of penalties u/r 25 of CER, 2002 r/w section 112 of Customs Act, 1962.
The original authority confiscated the seized goods with an option to redeem the same on payment of redemption fine of Rs.4,91,000/- and imposed penalty of Rs.10,000/-.
The Commissioner(A) dismissed the appeal by the assessee.
Aggrieved by this order, the appellant made his way to the Tribunal.
The CESTAT by its order dated 29/5/2007 partly allowed the appeal preferred by the appellant by reducing the redemption fine to Rs.1,00,000/- and also reduced the penalty to Rs.2000/-.
Not content, the assessee has preferred the present appeal before the Gujarat High Court.
It is contended that the assessee is registered as 100% E.O.U. and, therefore, was not liable to maintain registers as per the statutory rules; that even otherwise, when the Tribunal has observed that no clandestine removal has been alleged or found by the authorities, there was no justification in confirming the order of confiscation and consequently imposing/reducing the redemption fine, penalty.
The counsel for the Revenue submitted that there are concurrent findings of facts recorded by the authorities below with respect to confiscation of goods on the ground that there was difference in the books of accounts and physical stock and, therefore, confiscation is justified; that despite the above, taking a lenient view, the tribunal has reduced redemption fine and the penalty.
The High Court considered the submissions and observed -
+ It is required to be noted that there are concurrent findings of facts recorded by all the authorities below that at the time of search the assessee did not maintain proper/relevant registers. It was also found that the entire quantity of finished goods found in the premises of the assessee was in excess on computation of physical stock with the stock mentioned in the statutory records and the assessee could not explain the difference in the physical stock and as such the same has been admitted by the Excise Assistant and Partner of the assessee.
+ From the statements of the aforesaid two persons of the assessee it is clear that they have admitted that they have not maintained statutory records with an intent to remove the same without preparation of invoices and without payment of any duty. They have also admitted that the goods found were finished goods. Therefore, proper registers were required to be maintained.
+ Considering the facts and circumstances of the case when it was found that the relevant and statutory registers were not maintained and when it was also found that the quantity of finished goods found were in excess, it cannot be said that the authorities below have committed any error in confirming the order of confiscation of the goods seized.
As far as imposition of redemption fine and penalty, the High Court observed that a very lenient view had already been taken by the Tribunal and, therefore, in the facts and circumstances of the case, it cannot be said that an error has been committed by the CESTAT.
Holding that there is no reason to interfere with the impugned order of the Tribunal, the appeal was dismissed.
(See 2017-TIOL-441-HC-AHM-CX)
