Rule 209A penalty on a corporate body failed absent abetment and after voluntary duty and interest payment.

Penalty under Rule 209A of the Central Excise Rules, 1944 was found unsustainable where a corporate assessee had short-paid duty inadvertently, paid the differential duty with interest before notice, and no evidence of knowing abetment was established. The Tribunal treated the provision as one targeting a person who knowingly deals with goods liable to confiscation and followed the view that its equivalent penalty framework is not applied to a corporate body in the same manner as to an individual. The penalty was accordingly set aside.

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Issues: Whether penalty under Rule 209A of the Central Excise Rules, 1944 was sustainable against a corporate body in the absence of ated abetment and in the light of voluntary payment of differential duty and interest.

Analysis: Rule 209A penalises a person who knowingly deals with excisable goods liable to confiscation. The Tribunal noted that the appellant had short-paid duty inadvertently, had subsequently paid the differential duty with interest before issuance of the notice, and the record did not establish evidence of abetment. It also followed the view that the penalty provision, being akin to Rule 26 of the Central Excise Rules, 2002, is not applicable to a corporate body in the same manner as to an individual person.

Conclusion: The penalty under Rule 209A was not sustainable and was set aside in favour of the assessee.

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