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Commissioner of Central Excise, Lucknow Versus DSM Sugar

2016 (1) TMI 195 - CESTAT ALLAHABAD

Remission of duty - Loss due to auto combustion - Held that:- Oozing out is a natural phenomenon and, therefore, the case is well covered under Rule 21. The learned AR's contention that the respondent did not take sufficient precaution is not acceptable in the light of reports of Sector Officer and Range Officer as discussed above. The learned AR has not been able to show from any technical document that the respondent should have stored 10% less of the total capacity of the tank. Even assuming .....

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or the quantity oozed out. Revenue's appeal is simply based on the survey report of the insurance company which excluded 10% of the quantity stored while sanctioning the insured value. Even if the insurance company did not consider the quantity which had oozed out, there is no denying the fact that the same had occurred due to a natural phenomena. Therefore, no case is made out for denial of remission. - Decided against Revenue. - Appeal No. E/1751/2007, Cross-Objection No. E/CO/221/2007 - Fina .....

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quintals of molasses stored in tank No. 3 was rising due to sudden rise of temperature of the said tank. Although they took action to check the rise of the temperature, the same could not be controlled and resulted in auto combustion of the molasses involving Central Excise duty of ₹ 65,73,615/-. The respondent filed an application for remission of this Central Excise duty in terms of Rule 21 of the Central Excise Rules. The Commissioner allowed remission. Revenue is in appeal against thi .....

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Inspector of Central Excise visited the site on 16/05/2003 and saw the molasses oozing out from tank No. 3, spreading all around and also being emptied through a pipe and into a kutcha pit. Therefore, according to Revenue, the duty of 10% of the molasses which escaped auto combustion should not be remitted. 4. The learned Asstt. Commissioner (AR) appearing for Revenue stated that due to negligence of the respondent the molasses had oozed out and, therefore, duty on 10% of the total quantity cann .....

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horities. 6. We have carefully gone through the facts of the case and submissions made by both the sides. It is a fact that due to heat in the month of May the molasses started oozing out from tank No. 3. This was verified by the sector officer during his visit on 16/05/2003 who stated that the molasses was almost boiling at high temperature. It is also stated in his report that the authorities of the assessee were trying to bring the situation under control by circulation of water through the c .....

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help and guidance of the local Administration, fire brigade and Police was very much evident. The Range Officer in his report to the Assistant Commissioner found that all the necessary precautionary devices in the concerned tank were there and there was no proof of negligence or mischief. The fire brigade and survey report of Oriental Insurance Company also confirmed the loss due to spontaneous combustion. 6.1. The remission has to be examined in terms of Rule 21 of the Central Excise Rules, 200 .....

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