Belated jurisdictional objection rejected; penalty sustained for invoices issued without actual sale or dispatch of goods.

A belated jurisdictional objection was rejected because it was not raised at the appropriate earlier stage and was therefore treated as lacking merit. Penalty under Rule 173Q of the Central Excise Rules, 1944 was sustained because the record showed that the invoices were issued without actual sale or dispatch of goods, and in connivance with the buyer. The Tribunal held that this evidence was sufficient to support penalty notwithstanding earlier proceedings against the Managing Director.

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Issues: (i) Whether the adjudicating authority lacked jurisdiction over the appellant. (ii) Whether the penalty imposed on the appellant under Rule 173Q of the Central Excise Rules, 1944 was sustainable.

Issue (i): Whether the adjudicating authority lacked jurisdiction over the appellant.

Analysis: The objection to jurisdiction was raised belatedly, after the matter had already travelled through earlier rounds of litigation. The challenge was not taken at the earlier available stages and was therefore treated as lacking merit.

Conclusion: The jurisdictional objection failed.

Issue (ii): Whether the penalty imposed on the appellant under Rule 173Q of the Central Excise Rules, 1944 was sustainable.

Analysis: The record contained material showing that no actual sale or dispatch of goods had taken place in respect of the invoices in question, and that the invoices were issued in connivance with the buyer. On that basis, the Tribunal found sufficient evidence to support imposition of penalty on the appellant despite the earlier proceedings against the Managing Director.

Conclusion: The penalty was held sustainable.

Final Conclusion: The appeal failed on both the jurisdictional challenge and the challenge to penalty, and the impugned penalty order was sustained.

Ratio Decidendi: A belated jurisdictional objection may be rejected where it was not raised at the appropriate stage, and a penalty under the Central Excise Rules can be sustained where the record shows participation in issuance of invoices without actual sale or dispatch of goods.

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