- (1.) THE respondents are engaged in the manufacture of polyester filament yarn. An inspection was carried out by the Central Excise authorities on June 5, 1997 and found excess stock of 2,742.268 kgs. of twisted yarn in their godown against the recorded balance in the statutory records. Accordingly, a show -cause notice was issued to the respondent to show cause why Central excise duty amounting to Rs. 1,38,326.72 should not be demanded from the respondent under rule 9(2) of the Central Excise Rules, 1944 read with section 11A of the Central Excise Act, 1944 (hereinafter referred to as the Rules) and also show cause as to why penalty should not be imposed under rule 173Q of the Rules. The authority, after considering the reply, passed an order dated March 15, 2002 confiscating the seized goods giving an option to redeem the goods on payment of redemption fine of Rs. 1,00,000 along with payment of duty involved on the seized goods, i.e., Rs. 1,38,326.72 and imposed a penalty of Rs. 1,00,000 upon the respondent under rule 173Q, rule 9(2) and rule 226 of the Rules. The respondent, being aggrieved, filed an appeal before the Commissioner (Appeals), which was dismissed, against which the respondent filed a second appeal before the Customs, Excise and Service Tax Appellate Tribunal, New Delhi. The Tribunal by the impugned order allowed the appeal and set aside the order -in -original holding that the unaccounted goods found in the godown of the respondent were the goods returned from the buyer on June 4, 1997. The Department, being aggrieved by the order of the Tribunal, has filed the present appeal under section 35G of the Central Excise Act, 1944.
(2.) HAVING heard the learned counsel for the Department and the learned counsel for the respondent, we find that the buyer M/s. Vidhya Packaging Industries Pvt. Ltd. had returned the goods vide challan No. 133 on June 4, 1997, i.e., a day prior to the alleged inspection. The quantity shown in this challan prepared by M/s. Vidhya Packaging Industries Ltd. tallies with the quantity found during the inspection. Further, we find that due intimation of return of goods was intimated by the respondent to the Department concerned, which has been admitted and accepted by the Department. Consequently, we are of the opinion that the return of goods appears to be a genuine transaction and is not an afterthought. No evidence has been brought on record by the Department to indicate that no such goods were returned by M/s. Vidhya Packaging Industries Ltd. to the respondents. In the light of the aforesaid, we are of the opinion that the goods found in the godown of the respondents at the time of inspection were not unaccounted goods but were goods returned from the buyer. The Tribunal was justified in setting aside the order of confiscation and imposition of fine and penalty. We are of the opinion that no substantial question of law arises for consideration in the present appeal. For the reasons stated aforesaid, we do not find any merit in the appeal and is dismissed.;