TOPAZ COMMERCE LTD Vs. COLLECTOR OF C EX

JUDGEMENT

(1.) THE appeal by M/s Topaz Commerce Limited is for setting aside the order-in-appeal passed by the Collector (Appeals), Calcutta confirming the order of Deputy Collector of Central Excise, Calcutta-I Collec-torate imposing a penalty of one thousand rupees only on them under Rule 173Q. THE show cause notice issued to them alleged violations by them of Rules 9(1), 173C, 173F, 173G(1) and 57A. THE drawing up of the proceedings resulted as they cleared 99 pieces Expansion Valves without payment of Central Excise duty amounting to Rs. 33,660/- leviable thereon by wilful misuse of the benefit of Government of India Notification No. 75/87 dated 1-3-1987.

(2.) It is common ground between the two sides that the appellants cleared the goods in question in April, '87 availing of full exemption in duty. On 18-8-1987, the value of all excisable goods cleared by them in the year starting from 1-4-1987 exceeded Rs. 40 lakhs whereby they became ineligible for the benefit of complete exemption from duty available under the said Notification. Duty became payable for such past clearances also. The appellants have stated that they, on their own, paid the duty leviable. The department's case is that though the appellants became ineligible for the benefit availed of already on 18-8-1987 itself, they paid the duty duly on 24-11-1987. The Deputy Collector in his adjudication order held that they cannot be absolved of the contravention of the provisions of Central Excise Rules set forth in the show cause notice. He, however, took note of the fact that they are a S.S.I. Unit and took a lenient view in the matter and imposed a nominal penalty of Rs. 1000/- to meet the ends of justice under Rule 173Q of the Central Excise Rules. The Collector (Appeals) held that the contravention of Central Excise law on admitted facts stood established and penalty of Rs. 1000/- when the duty involved is over Rs. 33,000/- is more than reasonable. He rejected the appeal and upheld the Deputy Collector's order.

(3.) WHEN the appeal was argued before us, Shri S.R. Chatterjee, learned Consultant appearing for the appellants contended that there has been no offence committed by them. They filed a proper classification list for the goods covered by the exemption notification and they cleared the goods on nil duty Gate Passes. Subsequently, their value of the clearances of all excisable goods exceeded Rs. 40,00,000/- (Rupees forty lakhs) on 18-8-1987. They then filed a revised classification list which was received by the department on 21-10-1987 wherein they declared that the value of clearances exceeded Rs. 40 lakhs on 18-8-1987 and they undertook to pay differential duty w.e.f. 1-4-1987. They are not liable to any penalty under any of the provisions of Rule 173Q.