JAY ENGG. WORKS LTD Vs. CCE

JUDGEMENT

(1.) THIS appeal has been filed by the manufacturer of valves, nozzles and other I.C. Engine parts. They were served a show cause notice on 13.5.1992 asking for duty on scrap and proposing imposition of penalty. During the manufacture of their products, scrap was generated and removed from the factory premises, during the period 1.4.1990 to 31.3.1991 without payment of duty they had not declared the same in the classification list filed for the relevant period. The lower authority has confirmed a duty demand of Rs. 75,018/ - towards BED and Rs. 3,751/ - to SED on a quantity of 125.030 MTs of scrap cleared after considering the other items in the show cause notice could be cleared on duty as per relevant notification. Penalty of Rs. 25,000/ - under Rule 173Q of Central Excise Rules, 1944 was imposed on the manufacturer for contravention of Rules 173B and 9(1) ibid.

(2.) THE appeal is made on the ground that the manufacturer has properly accounted their production of I.C. engine parts and the scrap and there was no intention to evade payment of duty and the officers were visiting the premises and therefore demands in this case were barred by limitation under Section 11A. Rule 173B only provides that goods intended to be produced by manufacturer are to be declared and classified and failure to declare emergence of scrap on Rule 173B documents cannot be deemed to be suppression with an intent to evade payment of duty in the facts and circumstances of this case.

(3.) WE have heard Shri V.J. Shankaram, Ld. Advocate for appellants who fairly conceded that the present appeal is for waiver of penalty as the entire episode of non -mention of the scrap in the relevant documents for clearance under Rule 173B was due to clerical error on the part of the excise clerk dealing with the subject and keeping in mind the fact that the company was not having any intention to evade or avoid and the entire duty amount has been paid, the imposition of penalty is not called for and requested for setting aside the entire amount of penalty imposed.