Strict construction of Cenvat penalty rules limits liability to the credit taker, not company directors, absent express words.

Rule 13(1) of the Cenvat Credit Rules, 2002 is confined to the person who actually takes CENVAT credit, and its penal language cannot be extended by implication to directors of a private limited company. The provision must be construed strictly, so personal penalty on directors is not supported unless the rule expressly creates that liability. The reference to Section 11A of the Central Excise Act, 1944 underscores that the legislature uses express words when it intends to extend liability beyond the principal person.

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Issues: Whether personal penalty could be imposed on the directors of a private limited company under Rule 13(1) of the Cenvat Credit Rules, 2002, and whether the Tribunal could direct pre-deposit of such penalty against them.

Analysis: Rule 13(1) applies to the person who takes CENVAT credit and its penal language is confined to that person. The company, and not its directors, had availed the credit. Penal provisions are to be construed strictly, and absent express words extending liability to directors or other persons, the rule cannot be enlarged by implication. The reference to Section 11A of the Central Excise Act, 1944 only reinforces that where the legislature intended to extend liability beyond the principal person, it used express words such as

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