Penalty for trader's misdeclaration cannot be fastened on a job worker absent proof of suppression by the worker.

A job worker was not liable to penalty where duty had been assessed on the trader's declared value and the department failed to show suppression by the job worker. The misdeclaration was attributable to the trader; once the correct value emerged, the job worker paid the differential duty. On those facts, the penal provisions could not be applied to the job worker for the trader's declaration, and the penalty was held unsustainable.

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Issues: Whether penalty could be sustained against a job worker who paid duty on the basis of the trader's declaration, when the trader had misdeclared the value of the grey fabric.

Analysis: The duty liability was worked out on the value declared by the trader, and the department did not establish that the job worker himself suppressed the value of the grey fabric. The misdeclaration was attributable to the trader, and once the correct value came to light the job worker paid the differential duty. In these circumstances, the job worker could not be penalised for the trader's declaration under the penal provisions invoked.

Conclusion: The penalty was not justified against the assessee, and the Revenue's challenge failed.

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