2007 (11) TMI 483 - AT - Central Excise

Summary

Issues:
Remission application rejection based on storage loss of molasses during sugar manufacturing.

Analysis:
The appeal was filed against the rejection of a remission application by the appellants engaged in sugar manufacturing due to the storage loss of molasses in steel tanks. The appellants reported a loss of 110 tonnes of molasses, attributing it to storage loss, and requested remission based on the loss being less than 2%. The revenue contended that the appellants did not meet the conditions of the Trade notice. The Commissioner, in the impugned order, noted the absence of a satisfactory explanation for the loss and rejected the remission application.

Upon review, it was found that the appellants had not mentioned the cause of loss at any stage, leading to the rejection of the remission application. However, a Board circular dated 18-7-1983 addressed the loss of up to 2% in molasses stored in kuchha pits or steel tanks, stating that such loss is condonable. Considering this circular, it was determined that since the storage loss reported by the appellants was less than 2%, their contention had merit. Consequently, the impugned order was set aside, and the appeal was allowed. The decision was announced and pronounced in open court.