Penalty under Rule 209A requires proof of possession or specified dealing with excisable goods and requisite knowledge.

Rule 209A of the Central Excise Rules, 1944 imposes penalty only on a person shown to have acquired possession of, or otherwise dealt with, excisable goods by transporting, removing, depositing, keeping, concealing, selling or purchasing them, with knowledge or reason to believe that the goods were liable to confiscation. Where the order records no finding that the person ever possessed or handled the goods in any such manner, the foundational requirements for invoking the penal provision are not met. On that basis, the penalty was held unsustainable against the appellant and the order was set aside to that extent.

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Issues: Whether penalty under Rule 209A of the Central Excise Rules, 1944 could be imposed on a person who was not shown to have acquired possession of, or to have dealt with, the excisable goods in the manner contemplated by the rule.

Analysis: Rule 209A fastens penalty only on a person who acquires possession of, or is concerned with transporting, removing, depositing, keeping, concealing, selling, purchasing, or otherwise dealing with excisable goods, with knowledge or reason to believe that the goods are liable to confiscation. The order imposing penalty did not record any finding that the appellant had ever come into possession of the goods or ated in their transport, removal, deposit, keeping, sale, or purchase. In the absence of those foundational facts, the preconditions for invoking the penal provision were not satisfied.

Conclusion: Penalty under Rule 209A was not sustainable against the appellant.

Final Conclusion: The penalty order was set aside insofar as it related to the appellant, and the appeal succeeded to that extent.

Ratio Decidendi: Penalty under Rule 209A can be imposed only when the person against whom it is levied is shown to have dealt with excisable goods in one of the statutorily specified ways, with the requisite knowledge or reason to believe regarding confiscability.

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