ORDER
S.S. Kang, Vice-President
1. All the three appeals are against the same impugned order. Therefore, these are being taken up together.
2. Appeal No. E/3829/03-NB(S) is filed by Sh. P.V. Malhotra, Executive Director against the imposition of penalty. The Revenue has also filed appeal for enhancement of the penalty. Revenue filed second appeal against the impugned order whereby confiscation of semi-finished goods was set aside.
3. The contention of the learned Counsel, appearing on behalf of Sh. P.V. Malhotra, appellant, is that Mr. P.V. Malhotra, was working as Executive Director and was looking after the work of general administration, banking, etc. He was not incharge of excise work. The contention is that in the impugned order, the Commissioner (Appeals) has upheld the penalty on the ground that the clandestine removal of finished goods and substitution with some finished goods could not have been possible without the consent and knowledge of the Executive Director. The contention is that there is no evidence to show any role played by the present appellant with intent to evade payment of duty. Therefore, the imposition of penalty is not sustainable.
4. The contention of the Revenue is that Mr. P.V. Malhotra was Executive Director and all the paper work was dealt with by him. He was forwarding the request of Marketing Division to the Managing Director and also orders passed by the Managing Director were also routed through him. Therefore, he is liable for penalty. The reduction of penalty by the Commissioner (Appeals) is also not sustainable.
5. The contention of the Revenue, in the second appeal, is that the unfinished goods were stored along with the finished goods in such a way to show that there was no shortage of finished goods in fact the finished goods were cleared without payment of duty. Therefore as the goods which are replaced with finished goods, are liable to confiscation.
6. In this case, the Adjudicating Authority imposed a penalty of Rupees five lakh on the Executive Director which was reduced to Rupees 35,000/- by the Commissioner (Appeals). The Commissioner (Appeals), under the impugned order has held that without the consent and knowledge of the Executive Director, who is holding a senior position, the substitution of semi-finished goods could not have been possible. There is no finding regarding omission and commission on the part of the present appellant, who intent to evade payment of duty. In the impugned order, the finding is that the substitution cannot be possible without active consent and knowledge of the appellant, but there is no evidence to show that actually this substitution was on the asking of the present appellant. In these circumstances, the imposition of penalty is not sustainable and hence set aside and the appeal filed by Sh. P.V. Malhotra is allowed and appeals filed by the Revenue are dismissed. In respect of second appeal of the Revenue whereby the impugned order is challenged vide which the confiscation in respect of the finished goods was set aside. In the show cause notice, it is admitted position that the metal blank gaskets were not having any CAF material layer and the Senior Engineer, Sh. V.K. Sharma, in his statement, staled that the gaskets can be used after the process of making composite of tin or CRC sheets and beats/CAF sheets. The gaskets, in question, are not complete and these cannot be used with the engines. In these circumstances, it is clear that the goods, in question, are semi-finished goods which cannot be used as gaskets. Mere presence of semi-finished goods along with the finished goods, will not make them liable for confiscation. In these circumstances, I find no infirmity in the impugned order whereby the confiscation is set aside. Thus the Revenue’s appeal is dismissed.
(Dictated and pronounced in open Court)