I've taken a good look at Paddington station and I would suggest you lodge an appeal on the grounds that the requirements for notices are not met (quoting the relevant bits of the S.I. including 16(3)(a)). In an appeal against a Penalty Fare, it is for the TOC to show the contrary (i.e. you do not have to prove the posters are missing/non-compliant but rather they have to prove they are present), and having walked round Paddington Station, I struggle to see how they could possibly do this. Posters I remember before have been removed and one obvious location for a Penalty Fares warning poster at one entrance even instead simply has a picture of Paddington Bear!