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2024 (6) TMI 754 - AT - Central ExciseIssues Involved: Appeal against imposition of personal penalty under Rule 26(1) of the Central Excise Rules, 2002. Facts: The appellant, as the Director of a manufacturing company, was alleged to have cleared goods without payment of duty during a specific period. The company was issued a show-cause notice proposing recovery of Central Excise duty, interest, and penalty. A personal penalty of Rs.50,00,000/- was imposed on the appellant under Rule 26(1) of the Central Excise Rules, 2002. Appellant's Argument: The appeal filed by the manufacturing company was abated by the Tribunal, extinguishing the liability. The appellant argued that without proper adjudication of the alleged improper accounting and clearance of goods by the company, imposing personal penalty on the appellant would be unjust. It was contended that Rule 26(1) cannot be invoked as there was no proposal or allegation of confiscation of goods in the show-cause notice. Various judgments were cited to support the argument. Appellant's Further Argument: The appellant asserted that there was no evidence of personal involvement in the alleged activities, and the penalty was based on assumptions. Evidence was presented to show that the goods in question were not manufactured and cleared by the company. Imposition of penalty solely based on the appellant's position as Director was deemed unwarranted, citing relevant case law. Revenue's Response: The Authorised Representative for the Revenue reiterated the findings of the Commissioner. Tribunal's Decision: After hearing both sides and examining the records, the Tribunal found that the penalty imposed on the appellant was not justified. It was noted that the allegations against the company were not supported by sufficient evidence, and the personal penalty on the appellant, as the Director, could not be sustained. The Tribunal referred to relevant case law and set aside the imposition of personal penalty under Rule 26(1) on the appellant. Conclusion: The appeal was allowed, and any consequential relief was granted as per law.
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