TMI Blog1994 (6) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... lrayan, Lakhimpur. During the sugar season 1982-83, the appellants stored 1,10,727 quintals of [molasses] obtained in the factory in Katcha temporary pits as pucca tanks were already full. The appellants in the meantime had sought Central Excise permission for storing molasses in Katcha pits. This permission was granted by the Superintendent on 5-5-1983 with the condition that permission would be valid upto May, 1983. During June and July, 1983 because of heavy rains and floods, the appellant contended that nearly 80,000 quintals of molasses stored in temporary Katcha pits were washed away and the remaining got unfit for consumption. The appellants were served with Show Cause Notice demanding duty amounting to Rs. 3,48,790.05 on 1,10,727 qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls), therefore, rejected the appeal and confirmed/upheld the order of the Collector. 3. Ld. Advocate Shri J.S. Agarwal submitted before us that they were given permission to store molasses upto 31-5-1983 and that they had also made request before the expiry of this permission, to the Superintendent for extension of permission. Molasses were destroyed due to floods caused by heavy rains during June and July, 1983. There has been no removal as such within the Rule 49. Duty can be demanded within the frame-work of Rule 49 only at the time of actual removal and in this case since the molasses were destroyed and remaining got unfit for consumption there is no removal as such. The Advocate admitted that they did not apply to the Collector for r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hable as in such cases either permission has been granted or the fact of destruction otherwise was not in dispute. 4. We have carefully considered the submission made by both the sides. Ld. Counsel admitted that the molasses continued to remain in Katcha pits without permission beyond 31-5-1983; but Ld. Counsel submitted that molasses were destroyed due to floods and seepage and he admitted that they had not applied to the Collector for remission of duty on such molasses as were destroyed due to natural causes. The facts as discussed in the case laws cited by the Ld. Advocate are somewhat distinguishable. In these cases permission had either been given or the fact of destruction through natural causes had been admitted by the Department i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e orders passed by the two Collectors against which the above-mentioned appeals were preferred. The Collector, Pune, in his order which is the subject-matter of appeal ED (Bom.) 33/84 had categorically stated that due to heavy rains from 26-6-1983 to 28-6-1983, 1531.540 M/T of Molasses belonging to M/s. Shree Dudhaganga Vedganga Sahakari Sakhar Karkhana Ltd., which was preserved in pit Nos. 1 and 2 was washed away". It was also stated in his order on receipt of the intimation from the factory, Superintendent, Central Excise, Bidri, visited the factory and found that the incident had occurred due to natural calamity and not on account of any mischief". Thus it could be said that the loss of Molasses which is the subject-matter of appeal E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the molasses were actually destroyed and permission of storage was controlled by the State Excise Authorities. 4.2 We find from the records before us that neither the appellants applied for the remission nor there was any serious attempt made to verify whether the entire quantity of molasses was destroyed either due to floods or seepage. The Asstt. Collector in the operative part of the order considered all the facts and in findings, concluded I find that assessee has not applied for remission after following required procedure. Besides, the entire quantity of molasses was destroyed in rain (Flood) water and there was also seepage in tank. Both the things could have been controlled by them. And then on these grounds the Asstt. Collecto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall on demand pay the duty leviable on any goods which are not accounted for in the manner specifically provided in these rules, or which are not shown to the satisfaction of the proper officer to have been lost or destroyed by natural causes or by unavoidable accident during handling or storage in such store-room or other approved premises". The second proviso to this rule reads provided further that the proper officer may not demand duty due on any goods claimed by the manufacturer as unfit for consumption or for marketing subject to such conditions as may be imposed by the Collector by order in writing. 4.4 It is, therefore, clear that Rule 49 clearly enjoins that payment of excise duty shall not be required unless excisable goods a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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