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2015 (8) TMI 1235 - AT - Central ExciseRecovery of wrongly taken cenvat credit - personal penalty whereas the company is under liquidation - Imposition of penalty under Rule 26 - Held that:- Show cause notice had been issued not only to the appellant company M/s. DTL, Unit-II (Aluminium Division) but also to the Managing Director, Shri M.B. Baheti, Shri Ravindernath Jain, Joint Managing Director and Shri Rajesh Maheshwari, Manager (Finance). Even if the Commissioner could not adjudicate the question of duty demand against M/s.DTL in view of the liquidation order of the High Court on 11.07.2005, in our view, the Commissioner could always adjudicate the question of imposition of penalty on the appellant, Shri M.B. Baheti and Shri Rajesh Maheshwari. Moreover, though the Commissioner has confirmed the duty demand against M/s.DTL, they are not in appeal and, therefore, this Tribunal is not required to go into the question as to whether the confirmation of duty demand against M/s.DTL was correct or not. Statement dated 28.07.2003 of Shri M.Baheti, Managing Director, which is being used against him, is that after taking stock of the situations in the wake of search of Unit M/s. DTL, Unit-II, he had removed Shri Rajesh Maheshwari from M/s. DTL as he found him solely responsible for this act. From this statement, no conclusion can be drawn that Shri M. Baheti was involved in day-to-day functions of the Aluminium Division of M/s.DTL or had knowledge about its activity of duty evasion. Moreover, from his statement referred to in para-15 of the show cause notice, it is seen that Shri H.P. Gupta, Advisor and Shri Rajesh Maheshwari, Manager (Finance) had been reporting to Mr. Ravindra Jain, Joint Managing Director and that during 1997-98, M/s. DTL (Aluminium Division) had become a sick unit and it had been decided to sell the assets of the aluminium division of the company to Shri Ravindera Jain and Shri Jain was inducted to run this Unit. Thus from this statement, it is clear that it is Shri Ravinder Jain, who was running the Aluminium Division and Shri M. Baheti was not involved in day-to-day functions of this Unit. In our view, therefore, the evidences on record are not sufficient to conclude that Shri Baheti was, in any way, concerned in removal of the clandestinely cleared goods from M/s. DTL. In view of this, the imposition of penalty under Rule 26 of the Central Excise Rules on Shri M. Baheti would not be sustainable and has to be set aside. - Decided partly in favour of assessee.
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