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TMI Blog2011 (11) TMI 551X X X X Extracts X X X X X X X X Extracts X X X X ..... ng goods are not liable to confiscation at all. Therefore Rule 26(1) is definitely not applicable to the facts of this case - Rule 26(2) is applicable in respect of a person who issues invoice without delivery of goods or any other document or abets in making such documents. Basically this Rule has been enacted to facilitate imposition of penalty on persons who issue fake/bogus invoices without supplying the goods to facilitate availment of Cenvat credit or on persons who abet in such activities. Under these circumstances, penalty cannot be imposed on the two respondents under Rule 26 - Decided against Revenue. - E/1230 and 1259/2010 - Final Order Nos. A/2106-2107/2011-WZB/AHD - Dated:- 17-11-2011 - Shri B.S.V. Murthy, J. Shri R.S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e view that under Rule 26 also no penalty can be imposed since the rule requires that goods should have been held liable to confiscation for imposition of penalty under Rule 26(1). Thus he took the view that penalty under Rule 15 of Cenvat Credit Rules or Rule 26(1) of Central Excise Rules cannot be sustained. In the Revenue s appeal it was contended that Rule 26(1) requires that the person concerned should have knowledge or reason to believe that offending goods are liable to confiscation and it is not necessary for adjudicating authority to confiscate certain goods or hold goods liable to confiscation before imposing any penalty on the concerned person. Rule 26 of Central Excise Rules, 2002 reads as under : RULE 26. Penalty for certain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scation cannot arise in this case. This is a clear case where offending goods are not liable to confiscation at all. Therefore Rule 26(1) is definitely not applicable to the facts of this case. It was also submitted by the learned A.R. that Rule 26(2) is applicable. However, I find that Rule 26(2) is applicable in respect of a person who issues invoice without delivery of goods or any other document or abets in making such documents. Basically this Rule has been enacted to facilitate imposition of penalty on persons who issue fake/bogus invoices without supplying the goods to facilitate availment of Cenvat credit or on persons who abet in such activities. Under these circumstances, penalty cannot be imposed on the two respondents under Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X
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