TaxTMI 
TaxTMI 
2023 (5) TMI 563
X X X X Extracts X X X X
X X X X Extracts X X X X
....a view that assessee namely M/s. Raipur Manufacturing Co. Ltd has not valued the captively consumed yarn properly as they have failed to include the expenses such as bonus, gratuity , interest and marketing expenses and in the cost of yarn which has been used captively. A demand show cause notice was issued on 24.09.1999 demanding Central Excise duty of Rs. 1,02,68,913/- . The penal provision under 173 Q( 1) has also been invoked. The penal provision under Rule 209 A of Central Excise Rules has also been invoked against the appellant Shri. Nitin M Dhandhukia and vide order-in-original dated 31.10.2000 the penalty of Rs. 5 Lacs has been imposed on the appellant under Rule 209 A of Central Excise Rules, 1944. 2. The Learned Advocate appear....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing further in the matter we need to look at the provision of Rule 209 A of Central Excise Rules, 1944. "RULE 209A. Penalty for certain offences:- Any person who acquires possession of, or is in any way concerned in transporting, removing, depositing, keeping, concealing, selling or purchasing, or in any other manner deals with, any excisable goods which he knows or has reason to believe are liable to confiscation under the Act or these rules, shall be liable to a penalty not exceeding the duty on such goods or ten thousand rupees, whichever is greater." It can be seen from the plain reading of the Rule 209 A that the person who is to be penalized under this provision needs to have physically dealt with the dutiable goods and ha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ically dealt with the excisable goods with the knowledge or belief that the goods were liable to confiscation. Rule 209A of the said Rules reads thus :- "Rule 209A. Penalty for certain of fences. - Any person who acquires possession of, or is any way concerned in transporting, removing, depositing, keeping, concealing, selling or purchasing, or in any other manner deals with, any excisable goods which he knows or has reason to believe are liable to confiscation under the Act or these rules, shall be liable to a penalty not exceeding three times the value of such goods or five thousand rupees, whichever is greater." CEXA-108-07.doc 10. The Division Bench of this Court by a judgment dated 14 September 2010 passed in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....dgment, it is clear that Rule 209A can be invoked and the penalty imposed only when the person has physically dealt with the excisable goods with the knowledge or belief that the goods are liable for confiscation. In the present case, the allegation was of unused gate passbooks CEXA-108-07.doc being misused by the Respondents for the purpose of issuing fake/forged gate passes to assist M/s. Singhal Swaroop Ispat Ltd. There was no case of the Respondents having physically dealt with the excisable goods with the knowledge or belief that such goods were liable to confiscation. We are thus, of the view that Rule 209A cannot be invoked in the present case. We follow the view taken by the Division Bench of this Court in Judgment dated 14 Septembe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ny excisable goods with such knowledge or belief. Acquisition of possession of goods is, indisputably, a physical act, and so is each of the various ways of dealing with goods, specifically mentioned in the rule. The expression "any other manner" should be understood in accordance with the principle of ejusdem generis and would, then, mean "any other mode of physically dealing with the goods". This position has been recognized in Godrej Boyce & Mfg. Co. (supra) which has been followed in A.M. Kulkarni (supra). The decision in Ram Nath Singh (supra) is also to the same effect. Any person to be penalized under the above rule should also be shown to have been concerned in physically dealing with excisable goods with the knowledge or belief tha....