BANSAL TRADERS Vs. CCE, DELHI

JUDGEMENT

(1.) THE brief facts in this case are that the appellants are a manufacturer of Super Enameled Copper Wires falling under Chapter Heading 8544.90. On 4.8.97, their factory premises were visited by the officers of Central Excise and from verification of the stocks they found some spools of finished goods weighing 615.530 Kg. bearing the trade name "VPI" belonging to M/s V.P. Industries. These goods were seized and the proceedings were initiated against the party which culminated in the Assistant Commissioner of Central Excise, MOD -IV, Delhi passing an order dated 6.9.98 in which he ordered for the confiscation of the seized goods and gave an option to redeem the same on payment of a fine of Rs.25,000/ -. He further imposed a penalty of Rs.25,000/ - on the party and a penalty of Rs.10,000/ - on Sh. Vijay Bansal, Proprieter of the firm. The Assistant Commissioner in this order observed that the party had been manufacturing the Super Enameled Copper Wires since long. They were required to tell the department about the manufacture of these goods with the brand name of other persons which they have failed to do so. The Assistant Commissioner in his order had observed that from the circumstances of the case, he is convinced that these branded goods were likely to be removed under the benefit of SSI scheme being availed by the party without paying the full effective rate of duty leviable on the branded goods.

(2.) THE above stated parties filed appeals and the Commissioner (Appeals), New Delhi vide order dated 16.11.2000 upheld the order of the original authority but reduced the penalty and the redemption fines to Rs.10,000/ - and Rs.15,000/ - respectively. She also set aside the penalty impose don Sh. Vinay Bansal.

(3.) M /s Bansal Traders are in appeal against the above order of Commissioner (Appeals). The matter is listed today for disposing of the stay petition filed by the party. I have heard Sh. V.K. Gupta, Advocate for the appellants and Sh. A.K. Jain, JDR for the respondents. The ld. Counsel for the appellants does not dispute that the impugned goods were bearing the brand name "VPI" belonging to M/s V.P. Industries and same were to be cleared from the factory of the appellants only on payment of appropriate duty leviable on them. He however, submits that the goods were still in the factory premises and duly accounted for in the RG -I register of the party. Therefore, the observation of the original authority that the same were likely to be removed by availing the benefit of SSI exemption is only a conjecture without any supporting evidence. As regards the allegation of not filing the declaration for these goods, the ld. Counsel draws attention to sub -rule (2) of Rule 173B of the Central Excise Rules, 1944 in terms of which at the relevant time an assessee was liable to file on a fresh declaration within a period of 30 days if any alteration had become necessary in respect of the excisable goods manufactured by him. It is the contention of the ld. Counsel of the appellants that they had started manufacturing the impugned branded goods for the first time when their factory premises were visited by the Central Excise authorities. It is contended that in terms of the provisions of this rule, they had at their disposal a period of 30 days to make necessary declaration for these goods and, therefore, there is no violation committed by them leading to the confiscation of the goods and imposition of penalty. I have considered these submissions. I fine prima facie force in these contentions. Admittedly the goods bearing the brand name of another party were still within the factory premises of the appellants and duly accounted for in their RG -I register. In terms of the provisions of above cited rule, they had a period of 30 days to file a declaration with the Central Excise authorities for these goods which was still not over. The appellants have, therefore, made out a prima facie case in their favour. I, therefore, grant them waiver from deposit of the penalty amount imposed on them and stay its recovery till the disposal of the appeal.