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2017 (2) TMI 883 - AT - Central ExciseImposition of penalty u/r 25 - clandestine removal - appellant's claim that M/s Pharmaica is registered dealer for the purpose of Chapter 28.29 and they are not registered dealer for the product of chapter 33. Also M/s Pharmaica, M/s Vipul Drugs and M/s Money Pharma are not purchaser, manufacturer, registered person of HUF or the importer - whether penalty u/r 25 justified? - Held that: - M/s Pharmaica and M/s Vipul Drugs are registered dealer. Rule 25 is very clear that penalty on a person, who is not under the category specified in the said Rule cannot be imposed. Since M/s Money Pharma does not fall in any category specified under Rule 25, no penalty under Rule 25 can be imposed on M/s Money Pharma. Whether penalty can be imposed on M/s Vipul Drugs and Pharmaica when they are registered dealer though they have not availed credit of these goods or transferred the credit on these goods? - Held that: - Rule 25 says says that if any excisable goods are removed in contravention of any provisions of rule or notification issued under these rules, penalty can be imposed. If any goods are clandestinely removed without issue of invoice and handled by a registered dealer then obviously the registered dealer cannot take credit and cannot pass on credit as there is no excise invoice - Rule 25 identifies purchaser or manufacturer or registered person of a warehouse or an importer or a registered dealer as a person liable to penalty because of the fact that they are registered with the Revenue and are reasonably conversant with law. It is not necessary that they could do actually official deal with such goods in their capacity as manufacturer or purchaser or registered dealer etc. Thus, penalty can be imposed on all such persons irrespective of the fact that they have dealt with these goods on record or off record - M/s Pharmaica and M/s Vipul Drugs are held liable to penalty u/r 173Q(1) of CER, 1944 and Rule 25 of CER, 2002 being a registered dealer - the penalty in case of Vipul Durgs is reduced from ₹ 8 lakhs to ₹ 4 lakhs and in case of M/s Pharmaica, the same is reduced from ₹ 2 lakhs to ₹ 1 lakh. Appeal disposed off - decided partly in favor of assessee.
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