2009 (4) TMI 610 - AT - Central Excise

Penalty - Personal penalty on authorised signatory - Held that - the Commissioner in his impugned order simply imposed penalty upon the appellant even without discussing as to how he was concerned with the clandestine removal by the manufacturing unit. The appellant was working under the instructions of the company and not being benefited by any other clandestine activity of the company should not be penalized on the sole ground that he was authorized signatory of the company during the relevant period. We find no justification for imposition of huge penalty of ₹ 5 lakhs upon the appellant - appeal allowed - decided in favor of appellant.

Summary

Issues:
Challenge to penalty imposed under Rule 209A of Central Excise Rules on the appellant.

Analysis:
The appellant, an authorized signatory of a company, was penalized Rs. 5 lakhs for clandestine removal without clear attribution of his role or any malafide intent by the Commissioner. The appellant argued that as an employee not involved in policy decisions, he should not be penalized, citing precedents like Shri Vinod Kumar v. CCE, Delhi and M/s. R.K. Ispat Udyog v. CCE, Raipur. The Tribunal noted the lack of discussion on the appellant's actual involvement in the clandestine activities and the absence of personal benefit from such activities. The Tribunal found no justification for the substantial penalty and set it aside, allowing the appeal. The judgment was pronounced on 24-4-09 by Ms. Archana Wadhwa, Member (J).