- (1.) This appeal has been preferred under Section 35G of the Central Excise Act, 1944 by the revenue against order dated 10-11-2004 passed by Customs, Excise and Service Tax Appellate Tribunal, New Delhi, proposing following question of law :- (i) "Whether Tribunal was correct to hold that confiscation and penalty for non-accountal of excisable goods, was imposable only when mens rea on the part of the offender is proved under Rule 173Q(1)(b) of Central Excise Rules, 1944, whereas the cited Rules does not make such a stipulation but provides that no accountal of excisable goods alone was sufficient to attract confiscation and penalty?" (ii "Whether the Tribunal ruling in Nizam Sugar Factory V/s. Collector, 1987 27 ELT 40 and in Kirloskar Brothers V/s. UOIm, 1988 34 ELT 30 affirming no necessity for proving mens rea in case of confiscation and penalty under Rule 173(1)(b)".
(2.) The adjudicating authority ordered confiscation and imposed penalty of Rs. 20,000/- holding that at the time of visit of staff, it was found that 210 mink blanket and some drop waste and end cuttings had not been entered the RG-I register. It was inferred that the said goods could be clandestinely removed and excise duty evaded.
(3.) On appeal the Commissioner reversed the view taken and held :- "The visiting staff also verified the stock of inputs which was found tallying with the recorded balance. I also note from the show cause notice that the partner of appellants in his statement recorded on 6-12-2000 itself explained their working in detail. He also explained the reasons and circumstances under which these goods were not accounted for in the statutory records. He also explained that from the very beginning they had not accounted for drop waste and end cuttings and also that they had not cleared any quantity of drop waste and end cutting from the beginning. Regarding non-accountal of 210 mink blankets he explained that due to a death of close relation he could not record the production properly.";