Personal penalty sustained where the managing director's role in under valuation and excess collection was established.

Personal penalty was sustained because the appellant, as Managing Director during the period of under valuation, was shown to be in charge of the activity through persons authorised by him to collect excess amounts. No material showed that he took steps to stop the misconduct, and the underlying finding of under valuation against the company had already attained finality. On those facts, the penalty was held to be justified and proportionate, so no interference was warranted.

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Issues: Whether the personal penalty imposed on the appellant under Rule 209A of the Central Excise Rules, 1944 was liable to be set aside or reduced.

Analysis: The appellant was the Managing Director during the relevant period when the company's under valuation activity and collection of excess amounts were found to have taken place. The record showed that excess amounts were collected by persons authorised by him and that there was no material to show that he had taken steps to such activity. The underlying charge of under valuation had already attained finality against the company, and on that basis the appellant's role as the person in charge could not be disassociated from the proven misconduct. On these facts, the penalty was found to be justified and proportionate.

Conclusion: The personal penalty under Rule 209A was upheld and no interference was warranted.

Final Conclusion: The appeal failed and the penalty imposed on the appellant remained in force.

Ratio Decidendi: Where the evidence establishes the appellant's active role as the person in charge during the period of under valuation and collection of excess amounts, personal penalty under Rule 209A is sustainable, especially when the underlying liability has attained finality.

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