Why am I being punished because of a cheater?

Dan I am not saying that they should overturn the results. I am wondering why I will not be able to advance to the next round.
From what you described, the next round apparently got underway before the cheater was nabbed. Games in progress cannot be cancelled, reset, or voided in order to "correct" this situation, because it would affect all other participants. The pairings would need to be reconfigured, and all the games would be reassigned. This would create a complicated mess, and the other participants don't deserve such an upsetting delay, as they are minding their own business.
This is why the second-place participant can only advance before the next round begins.
Dan, the next round has not been started yet. That is my point already.

One game is still in progress in the current round, correct? Unless tournaments have a setting of which I'm not aware, nobody is supposed to be declared advanced or eliminated until every game has been finished. This might be a bug.
Submit a Support Ticket to the staff (http://support.chess.com/Tickets/Submit and click the radio button Technical Support & Bug Reports) as soon as possible.
In the meantime, can anyone else comment on participants becoming officially "advanced" or "eliminated" before the current round is over? I had thought that that never happened.

Yes, still in progress and the current round has not been completed yet. I will submit a support ticket as you said. I hope that it works. Thanks Dan!

The next round started and no body in our group advanced. This guy most probably cheated at the games against me. This is ridiculous!

I am sure Chess.com and the programmers of this site, didn't have the program designed with a feature to give back any deserved exploits, from anyone's time here when they got cheated, after the cheater was removed. It was probably either over looked or deemed unnecessary.
Implementing such a system would be the right thing to do. I am fully aware of the daunting task of catching cheaters and it would perhaps be easier to to start over again with a new program, with these features built in, instead of trying to add it to the current system, atleast from a user ability, time and money stand point.
I wish Chess.com would just be honest and say, " we didn't anticipate this problem, we currently have no way of setting the record straight and it would be too expensive and or time consuming to do so, at this point". It would atleast be understandable with an apology. Instead they have chosen a stance which insults the intelligence and rights of many here.
It would also be nice to know whether or not Chess.com ever intends to implement a system to reverse the effects of cheating. If it is being considered, or is going to happen, it would be one of the fastest ways to qwell the disappointment and out cry, in an ethical manner under the present circumstances. Most people who prefer fairness are willing to accept some losses, knowing that the record will be set right one day for everyone. It is very unreasonable to expect players here, who already have a difficult enough climb as it is, to have to be expected to take these steps backward and somehow call it acceptable. I am sure setting the record right at a future date, with a back log of past victims, would be a new problem that wouldn't want to be dealt with. This is probably another reason they have chosen the position they have.
Choosing the stance they have chosen, has probably encouraged some to either get revenge in the form of cheating or to get back what they feel entitled to, much faster and with less struggle or both. I think it is sad that they would rather suppress the subject and not completely take responsibility, instead of being forth right about it. I honestly think this one of things that people take a long hard look at when considering a membership, or renewing.
@Chess.com
I haven't written this with malice. This is simply a way to help bring clarity to an unclear situation, where atleast knowing the truth can begin to bring peace. I hope this is seriously considered for everything it contains and not just looked at as something else to hide.

@nameno1had: I gather that you are referring to rating points lost from games with cheaters. I have received absolutely no impression that Chess.com is dodging the issue. They have stated plainly that they make no attempt to return points lost in this way. The vast majority of members, based on those who have expressed themselves, hold the viewpoint that returning points is both unnecessary and would be incredibly complicated. Those members are perfectly satisfied with the system as is.
I, too, hold this viewpoint, and it does not cause me to "take a long[,] hard look" at my decision to renew my membership.
Having a list of caught cheaters as a reference to determine how many points should be returned to certain victims would not make this process meaningfully easier. The butterfly effect of ratings on this site is vast, like a metaphorical ocean.
In any case, the most pressing issue of this thread is not rating points lost due to games with cheaters, but the fact that the OP did not advance to the next round in his tournament, due to a possible bug.

The next round started and no body in our group advanced. This guy most probably cheated at the games against me. This is ridiculous!
Speak to the tournament director alexandhisedisoncros in first instance ?
He may have to remove cheater [EDITED: DO NOT POST NAMES OF SUSPECTED CHEATERS ON ANY FORUM. Once they are identified, and staff verifies the allegation, they will appear on the 'cheaters listing'.
moderator.]
(Apologies but that member was banned for cheating long ago & he IS on the list ?)
from the competition in order for the table to correct itself.
If he cannot adjust it ask for explanation from chess.com help/support.

@nameno1had: I gather that you are referring to rating points lost from games with cheaters. I have received absolutely no impression that Chess.com is dodging the issue. They have stated plainly that they make no attempt to return points lost in this way. The vast majority of members, based on those who have expressed themselves, hold the viewpoint that returning points is both unnecessary and would be incredibly complicated. Those members are perfectly satisfied with the system as is.
I, too, hold this viewpoint, and it does not cause me to "take a long[,] hard look" at my decision to renew my membership.
Having a list of caught cheaters as a reference to determine how many points should be returned to certain victims would not make this process meaningfully easier. The butterfly effect of ratings on this site is vast, like a metaphorical ocean.
In any case, the most pressing issue of this thread is not rating points lost due to games with cheaters, but the fact that the OP did not advance to the next round in his tournament, due to a possible bug.
We are intitled to our opinions. I have never saw an indepth explanantion on their part, other than what they will or won't do regarding compensation to victims. That gives no explanation for why, or possible improvement. I won't make unnecessary apologies for anyone or sugar coat anything. I fail to see how your opinion is inline with the consensus here. I honsestly think many non paying members don't really feel at liberty to say what the really think.
Simply returning the points lost on a match by match basis would be the logical, correct and simplest thing to do.This would be the same for win loss, draw and tourney stats. It seems you are reading more into it than necessary.

Not to be a grammar nitpicker, but isn't the word "relevent" misspelled in the instructions to be relevant, helpful and nice? Or is that an alternative spelling?

@nameno1had: I have not and do not belittle your opinion or your expression of it. My opinion, in turn, is that yours has no foundation, and, in like manner, I won't make unnecessary apologies.
Chess.com has not, to my knowledge, given an in-depth explanation for their policy. I don't believe they owe it to us. I believe it need not be stated, because many members have come to the conclusion themselves: the extreme complexity entailed.
How could it be simple? How do you propose such a compensatory system would proceed? Perhaps your conception of the approach is different from what I am envisioning.
I got your point Dennis :) However, I see this as a logical flaw.
If someone's account get closed because s/he cheated, then the opponents win the games with out of time. If this guys account is closed and s/he already won lots of games with cheating they cannot be changed since it is too complicated.
Same analogy, if a cheater's account is closed before the current round finished, he should not be advanced to the next round.