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2022 (3) TMI 100 - AT - Central ExciseLevy of penalty on Director u/r 26 of CER - involvement of the director of the appellants in clandestine activities or not - wrong availment of CENVAT Credit - HELD THAT:- Shri Niten Maru, Director of Appellant 1 in his statement dated 09.03.2010 inter alia stated that he did his chartered accountancy in 2004. When he was asked to confirm the receipt of imported scrap under the said Bills of Entry, by way of any independent documents such as copy of any octroi receipt of any Municipal corporation, he stated that he did not have any such evidence but would produce if available by 12/3/2010. He did not appear thereafter and informed that Appellant 2 would represent them - Appellant 2 could not give any independent evidence of receipt of the goods corresponding to the said two B.E., no weighment slip was produced no details such as ledgers for freight payments, CHA and Octroi payments were produce, LRs pertaining to the above consignments were not produced. When he was asked to comment on the admission of the transporter of having diverted the consignments of aluminum scrap to Ahmednagar he replied that he did not know. Appellant 1 has admitted to non receipt of the goods in their premises and have reversed the credit. Nothing contrary to establish the receipt of the said goods imported by these two bill of entries have been produced by the appellant with their appeal or during the course of hearing before me, hence there are no reason to differ with the impugned order to the extent it pertains the Appellant 1. Penalty imposed on Appellant 2 - HELD THAT:- There are not much reasoning has been assigned by the said order, to show that Appellant 2 was having mens rea or direct involvement for invocation of Rule 26 - Since the impugned order fails to establish the ingredient of “mens rea” on the part of the Appellant 2 who was otherwise performing their duties as employee of the company, the penalties imposed on the appellant 2, cannot be upheld. The appeal filed by the Appellant 1 is dismissed - appeal filed by the Appellant 2 is allowed.
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