If your serps haven't changed (i.e dropped a lot or even entirely removed from the index) then you haven't been penalised, they just changed your PR, it happens.
Here is a post telling how can you check if Google penalized you. How to Check if Your Website is Penalized by Google Hope that helps.
Its normal.. There may be a various reasons for a decrement in PR. Link Sell, decrease in backlink etc..
Thanks this is a really good response. The article has some really helpful pointers for newbies who are unsure of whether their site has been penalised, but looking at a range of factors linked to your site rather than just one. Just because you've experienced a drop in your serps rankings doesn't always mean that you have been penalised by google
It's probably for 'link selling' and they just reduced the visible Pagerank. They done that to me the other day also, a site with about 30 x PR6 pages and hundreds of PR5 and PR4 dropped to a few PR4's and under. If they want to be that childish and pathetic i wouldn't worry about it, i wasn't selling links so they can take the lot for all i care.
Do you have any paid links in your site? If you have then remove them, or add a no follow tag on them and then request a reconsideration in webmaster tools.
My site is a paid directory. So all links are paid. And also there are several homepage-sitewide paid links. Should i have to add no follow all of them or just homepage-sitewide links? And how can i request a reconsideration in webmaster tools?