I T C LTD Vs. COLLECTOR OF CENTRAL EXCISE
LAWS(CE)-1991-3-5
CUSTOMS EXCISE AND GOLD(CONTROL) APPELLATE TRIBUNAL
Decided on March 22,1991

Appellant
VERSUS
Respondents

JUDGEMENT

T.P. Nambiar, Member (J) - (1.) THE above captioned appeals are directed against the orders passed by the learned Additional Collector of Central Excise, Patna, in order No. 16 MP/Addl. Collr/89 dt. 30th August, 1989. In terms of that order the Additional Collector confiscated 100 CFCs of scissors brand cigarettes covered under photo copy of G.P. 1 No. 2401 and ordered that the same may be redeemed on payment of a redemption fine of Rs. 1,00,000/-. A penalty of Rs. 1,000/- was imposed on M/s. I.T.C. under Rule 52A, and Rs. 4,00,000/- on M/s. I.T.C. under Rule 209A of the Central Excise Rules, 1944. Another sum of Rs. 25,000/- was imposed as a penalty on the appellant M/s. Road Transport Corpn. Pvt. Ltd., under Rule 209A, of the Central Excise Rules. THE brief facts of the case are that during the course of preventive patrolling on National Highway near Rajanagaram, the Supdt. of Central Excise, Rajamundry Preventive Unit intercepted a lorry No. TNM 42391 at 20.00 hrs. oh 22-9-1986. THE truck was found loaded with 400 CFCs of scissors brand cigarettes. Out of these 400 CFCs, 300 CFCs were covered by original gate pass No. 2402 dt. 12-4-1986 and 100 CFCs were transported under photo copy of gate pass No. 2401 dated 17-9-1986. As per the transport documents, the cigarettes were consigned from I.T.C. Munger to I.T.C. godown Coimbatore. THE Supdt. Rajamundry seized the entire consignment along with the lorry for violation of the provisions of Rules 9 and 52A of the Central Excise Rules. THE statement of the driver was recorded and the gate pass No. 2402 and 2401 and the loading manifest and other documents were seized. THE driver stated that 300 CFCs of cigarettes under GP 2402 were transhipped directly from the lorry from Munger and thereafter the 100 CFCs were loaded from the transport godown in Ichhapuram. THE statement of the Manager of the Road Transport Corporation and the owner of the lorry were also recorded. THE 400 CFCs of scissors brand cigarettes and the lorry were released provisionally on 31-10-1986.
(2.) Thereafter the investigation proceeded and show cause notices were issued to M/s. I.T.C. Ltd. and M/s. Road Transport Corporation Pvt. Ltd., and the owner of the lorry and the driver as to why duty on 100 CFCs cigarettes should not be demanded under Rule 9(2) and why the 400 CFCs cigarettes should not be confiscated along with the lorry and why penalty should not be imposed on them under Rules 9(2), 52A and 209A. The replies were filed and after the adjudication the impugned order was passed. Learned Senior Advocate, Sri R.N. Das, appearing on behalf of the appellants, contended that on the facts and circumstances of the case the findings of the Additional Collector that a violation is made out under Rule 52A is not correct. He also contended that the provisions of Rule 209A are not attracted to the facts of this case. It was his contention that the question of imposition of penalty, for violation of Rule 52A of the Rules does not arise in the facts and circumstances of this case as the 100 CFCs were handed over by the Company, M/s. I.T.C. Ltd. from its Munger factory to the transporter under a valid original gate pass in the prescribed form which was countersigned by the jurisdictional authorities at Munger. It was, therefore, contended that Rule 52(A)(5) has no application in the instant case in so far as the Company is concerned because clause (a) and (b) applied to a person who carries or transports excisable - goods from a factory. Therefore, he contended that M/s. I.T.C. Ltd. is not liable in this regard.
(3.) IN so far as clause (c) of sub-rule (5) is concerned, it was his contention that since 100 CFCs had already been cleared from the factory under a valid original gate pass, the same cannot be applied to M/s. I.T.C. Ltd. It was also contended that in any event there is no evidence on record to show that there was any mala fide intention on the part of the company. IN this connection he relied on the decision of the Supreme Court reported in Hindustan Steel Ltd. v. State of Orissa 1978 (2) E.L.T. 5159. He, therefore, contended that, in the absence of mens rea no penalty should have been imposed. He also relied on the decisions of the Special Bench, and submitted copies of three such decisions. It was contended that no penalty can be imposed under Rule 209A on M/s. I.T.C. Ltd. Sri Das stated that there was nothing on record to show that M/s. I.T.C. was in any way connected with the transport of these CFCs of scissor brand cigarettes with the knowledge that they are liable to confiscation under the Act. IN such circumstances it was his contention that the confiscation of 100 CFCs cigarettes and imposition of penalty on the appellant M/s. I.T.C. Ltd. is not in accordance with law.;


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