PRIYADARSHINI FABS LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) The original authority imposed a penalty of Rs. 19,321/ - on M/s. Priyadarshini Fabs Ltd. (appellants in appeal No. E/1047/04) under Section 11AC of the Central Excise Act and a further penalty of Rs. 10,000/ - on them under Rule 25 of the Central Excise Rules, 2002. It also imposed a penalty of Rs. 10,000/ - on Shri Murali Raja, Managing Director of the above Company (appellant in appeal No. E/1048/04) under Rule 26 of the Central Excise Rules, 2002. The first appellate authority, in separate orders, sustained these penalties. Hence these appeals.

(2.) The original authority had also imposed penalties on M/s. A.P.S. Cottons, M/s. N.A. Pappuraja Sons Ginning Factory and Shri V.P. Balamurugan (Manager of the Ginning Factory) and these penalties were also sustained by the first appellate authority in different orders. The appeal filed by M/s. A.P.S. Cottons, M/s. N.A. Pappuraja Sons Ginning Factory and Shri V.P. Balamurugan came to be disposed of by this Bench as per Final Order Nos. 614 to 616/2005 dated 20 -4 -2005.

(3.) Heard both sides. Ld. Counsel for the appellants submits that M/s. Priyadarshini Fabs Ltd. or the Managing Director of the Company did not clandestinely remove cotton yarn on cones and that the department's allegation to the contra is baseless. What actually happened was that the Proprietor of M/s. A.P.S. Cottons forcibly removed the goods from the appellants' premises for securing repayment of certain amount which was due to M/s. A.P.S. Cottons from the appellants. In the circumstances, according to ld. Counsel, no penalty is liable to be imposed on the appellant -company under Section 11AC, nor is any penalty imposable on its Managing Director under Rule 26 of the Central Excise Rules, 2002. Ld. SDR reiterates the finding of the lower appellate authority.