TaxTMI 
TaxTMI 
2025 (8) TMI 165
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.... dated 22.12.2008 impugned order passed by the Commissioner deciding the proposals made in the show cause notice dated 13.04.2007 covering the period 2006-2007 is assailed by M/s Supreme Road Transport (P) Ltd. Supreme Transport, Supreme Trading Co. Supreme Trading and Shri Ravi Singhal, Director of Supreme Transport Ltd. in so far as it imposes penalties on them under Rule 26 of the Central Excise Rules, 2002. 2. The facts which led to the issue of the impugned order are that, receiving intelligence that M/s A.P. Pouches (P.) Ltd. had clandestinely manufactured and cleared Gutkha from its factory, the departmental officers visited the godowns of Supreme Transport at Raipur and conducted checks in the presence of Shri Ravi Singhal. On ph....
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....red an appeal before Delhi High Court which restored these appeals to the original numbers to he heard afresh by this Tribunal. 7. We have heard Shri Aditya Kumar, learned counsel for the appellant and Shri Bhagwat Dayal, learned authorized representative for Revenue and perused the records. Submissions on behalf of the appellants 8. Learned counsel for the appellants made the following submissions :- (i) Penalty has been imposed on the appellants under Rule 26 of the Central Excise Rules, 2002 Rules. The basic ingredients for imposition of penalty under this rule is the knowledge that the goods being dealt with were non-duty paid and thus liable for confiscation. This knowledge is absent in the present case. Supreme Road ....
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.... the manufacturer on bond. After completing investigation, the SCN dated 13.04.2007 was issued proposing to confiscate the seized Gutkha, vehicles used for transporting them and imposing penalties on Supreme Road Transport, Supreme Trading Co. and Director Shri Ravi Singhal. By the impugned order dated 22 December 2008, the Commissioner confiscated the seized goods, confirming the demand of duty and imposed penalty on the manufacturer. He also imposed penalties of Rs. 15 lakhs on Supreme Road Transport Rs. 5 lakhs on Supreme Trading Co. and Rs. 5 lakhs on Shri Ravi Singhal. (ii) In the first round of litigation, by an order dated 01.03.2017, this Tribunal dismissed the appeals of the manufacturer as well as the appeals by Supreme R....
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....sions for both sides and perused the records. 11. Under dispute in these three appeals is only the penalty imposed on Supreme Road Transport, Supreme Trading and Shri Ravi Singhal. Undisputedly, the Gutkha was seized from the godowns of the Supreme Road Transport at Raipur and not in or near the factory premises of M/s K.P. Pouches P. Ltd. We do not find any legal obligation on the transporter to ensure that the goods which he is carrying are duty paid under Central Excise Act or Rules. Therefore, it must be seen if there is any evidence to establish that the appellants had transported any excisable goods which they knew or had reason to believe were liable to confiscation under the Central Excise Act or Rules. Rule 26 of the Central Exc....
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....er only if he acquires possession or is in any way concern in transporting or any other manner dealing with excisable goods which he knows or has reason to believe are liable to confiscation. In this case, the goods were allegedly manufactured by M/s K.P. Pouches, Delhi and cleared without payment of duty. The goods which were seized were not found anywhere near the factory, but in another city - Raipur and in the godown of the transporter. We do not find any evidence in the impugned order which can lead us to conclude that the appellants - Supreme Road Transport, Supreme Trading and Shri Ravi Singhal had any knowledge of the non-duty paid nature of the goods or that they were liable for confiscation under Rule 25. We, therefore, find that ....