SRI SHANKAR BHAGAVAN Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THESE appeals arise from Orders -in -Original No 2/2000 dated 13.1.2000 by which the Commissioner of Central Excise Bangalore has imposed penalty on the appellants in terms of Rule 209 A of Central Excise Rules for having dealt with excisable goods which have been received by them without payment of duty. The allegation is that the goods .were manufactured by M/s Bremel Rubber Industries and they had cleared the goods to the appellant without payment of duty. By the same impugned order, the Commissioner had dropped the proceedings on the allegation of clandestine manufacture and removal of goods against M/s Bremel Rubber Industries. However, he had taken a different view in respect of these appellants, which is under challenge. Learned Counsel submits that revenue had filed an appeal against the Order dropping demands against M/s Bremel Rubber Industries and this Bench by Final Order No 1470,1471/2005 dated 23.8.05 upheld the dropping of demands and dismissed the Revenue appeal. It is submitted that once, the demands against the manufacturer has been dropped, then in such a circumstances, imposing penalties against the appellant on the ground that they have received excisable goods without payment of duty is not sustainable in law. He produced a copy of the Final Order and prays for setting aside the impugned order imposing penalty against the appellant.

(2.) ON a careful consideration, and perusal of the impugned order, we notice that the charge of clandestine manufacture and removal against M/s Bremel Rubber Industries has been dropped by the Commissioner. He has clearly noted in the impugned order that in the absence of any circumstantial evidence M/s Bremel Rubber Industries cannot be held to have received raw -materials purchased in the name of 5 units and manufactured and cleared tread rubber in the name of the said units. When the Commissioner has categorically come to the conclusion that no excisable goods were manufactured and cleared and dropped the proceedings against the manufacturer, it is surprising as to how the persons who are unconnected with the goods could be imposed with penalty. The imposition of penalty against the appellants under Rule 209 -A does not survive when main demands against the manufacturer has been dropped. There is no evidence worth the name to implicate the appellants. There is no merit in the Commissioner's imposing penalty on the