Personal penalty under central excise rules requires positive proof of knowledge or involvement, not mere corporate designation.

Personal penalty under Rule 209A of the Central Excise Rules, 1944 cannot rest on a person's designation alone. Where the Revenue relies only on office held, a loose sheet, or conjecture, it must still prove conscious participation, personal knowledge, consent, or involvement in the clandestine removal. The handwriting evidence did not link the Chairman to the loose sheet, and there was no specific material showing his day-to-day involvement or awareness of the alleged activity. On that record, the penalty was not sustainable and was set aside.

---

---

Issues: Whether personal penalty under Rule 209A of the Central Excise Rules, 1944 could be imposed on the Chairman of the company in the absence of positive evidence of his knowledge, consent, or involvement in the clandestine removal.

Analysis: The allegation against the appellant rested on his designation as Chairman and on an inference drawn from a loose sheet and a statement attributed to an employee. The handwriting expert's opinion indicated that the signatures on the loose sheet were not the appellant's, and the adjudicating authority's further observation that the act could have been done at his instance was treated as conjectural. For invoking Rule 209A, the record must show conscious participation, personal knowledge, or belief; mere holding of office or a generalized assumption that a Chairman must know of all activities is insufficient. The appellant's residence away from the factory and the absence of specific evidence linking him to day-to-day affairs or to the clandestine activity negated the foundation for penalty.

Conclusion: Personal penalty under Rule 209A was not sustainable against the appellant and the penalty was set aside.

Ratio Decidendi: A personal penalty for clandestine removal cannot be imposed on a Chairman or director merely by virtue of office; the Revenue must establish positive evidence of conscious knowledge, consent, or involvement.

---