2007 (3) TMI 97 - AT - Central Excise

Penalty Alleged that appellant is indulge in transportation, acquiring possession, purchase and sales of non-duty paid Sintex PVC doors and thereby abetting the offence and accordingly penalty imposed on him Held that allegation is not correct

Summary

Issues: Imposition of penalty under Rule 209A of Central Excise Rules, 1944 and Rule 26 of Central Excise (No. 2) Rules, 2001 without necessary findings.

In this case, the appeal was filed against the imposition of a penalty of Rs. 15 lakhs on the appellant by the adjudicating authority under Rule 209A of the Central Excise Rules, 1944 and Rule 26 of the Central Excise (No. 2) Rules, 2001. The appellate tribunal found that the Commissioner's order lacked necessary findings to support the penalty. The Commissioner had imposed the penalty on the appellants for transporting, acquiring possession, purchase, and sales of non-duty paid Sintex PVC doors without establishing whether the appellants had physically dealt with the goods with the knowledge or belief that they were liable to confiscation. The tribunal highlighted that for a penalty under Rule 209A, it is essential to prove that the party had knowledge or reason to believe that the goods were liable to confiscation, which was missing in the Commissioner's order. Despite the assumption that the appellant had engaged in activities related to non-duty paid goods, there was no evidence to show the necessary knowledge or belief required for the penalty. As a result, the penalty was set aside, and the appeal was allowed.