Penalty cannot rest on a different rule than the one stated in the show cause notice

Penalty under Rule 209-A of the Central Excise Rules, 1944 could not be sustained where the show cause notice invoked only Rule 173-Q(1) and Rule 9(2). The ingredients of Rule 173-Q(1) and Rule 209-A were different, so a notice under one provision did not give adequate opportunity to defend a charge under the other. Mere reference to penal action in the notice was insufficient when the specific provision ultimately relied on was never put to the appellant. The penalty was set aside.

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Issues: Whether penalty could validly be imposed under Rule 209-A of the Central Excise Rules, 1944 when the show cause notice proposed penal action only under Rule 173-Q(1) and Rule 9(2) of the Central Excise Rules, 1944.

Analysis: The notice alleged clandestine manufacture and clearance of cinema projectors and called upon the appellant to answer penal action under Rule 173-Q(1) and Rule 9(2). The adjudicating authority, however, shifted the basis of penalty to Rule 209-A. The ingredients of Rule 173-Q(1) and Rule 209-A are different and apply in different situations, so notice of one provision does not give a sufficient opportunity to meet a charge under the other. Mere reference to a penal intent in the notice was not enough where the specific provision invoked in the order was never put to the appellant for defence.

Conclusion: Penalty under Rule 209-A could not be sustained and was set aside.

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