Customs, Excise and Gold Tribunal - Tamil Nadu
Eid Parry (India) Ltd. vs Commissioner Of Central Excise on 23 February, 2004
Equivalent citations: 2004(167)ELT336(TRI-CHENNAI)
ORDER S.L. Peeran, Member (J)
1. The appellants are aggrieved with the rejection of remission of duty on goods lost and destroyed due to heavy storm. The only ground taken by the Commissioner is that appellants have not shown that they had taken sufficient precaution to avoid loss of goods by natural causes or by unavoidable accident during handling or storage in store room or other approved premises.
2. Ld. Counsel submits that the duty amount involved is Rs. 43,020/-. He submits that appellants are manufacturers of ceramic sanitarywares. After manufacture, the goods are kept in the open yard and arranged one above the other neatly in an arranged manner. This procedure has been adopted by them after due notice to the department and the same method is being continued till date for several years. Due to very heavy rain and storm, the sanitarywares arranged one above the other collapsed and there was damage to it irretrievably. Therefore, they drew mahazar after notifying the department about the same and after taking photographs. A claim was made on the basis of actual loss. He submits that department has not disputed the quantum of the amount involved in the loss but have only taken a view that they had not shown that sufficient precautions were taken in storing the goods. It is submitted that this was the only way in which the goods were stocked from the time of starting production and it is being continued till date, and therefore the question of doubting the appellants taking precaution does not arise. He, therefore, submits that remission of duty is required to be granted to them.
3. Ld. DR submits that this aspect is required to be verified. Whether the department was notified for stocking the sanitarywares in the open yard is a matter of verification. He submits that the matter is required to go back to the original authority for due verification. Ld. DR also submits that the aspect of appellants' seeking insurance claim on the damaged goods is also required to be verified.
4. Ld. Counsel in reply submitted that no claim was lodged for issuance in the matter.
5. On a careful consideration of the submissions, and on perusal of the order, it is very clear that department has not raised any objection with regard to amount of which remission is claimed. The only objection raised by the Commissioner is that in terms of first proviso to Rule 49(1) of Central Excise Rules, the remission of duty can be granted by the Proper Officer only if the goods were lost or destroyed by natural causes or by unavoidable accident during handling or storage in store room or other approved premises. The Commissioner after noting the proviso has held that assessee failed to explain as to what measure were taken by them to avoid loss. It is the contention of the appellant that department was aware of the manner in which the goods were stocked in the open yard and it is being continued to be done even today from the date of their starting production. If this fact is ascertained, then the appellants are required to show that they had not changed the manner of stocking so as to cause loss to the goods. The department is not disputing the destruction of the goods due to storm and rain. Since it is due to natural cause, their claim has been accepted but only doubt has been raised as to whether the appellants had taken sufficient precaution. Ld. Counsel submits that all precautions were taken and the department was notified of the same. Ld. DR has raised an objection with regard to appellants having taken benefit from, the insurance or not. This aspect is required to be verified. Therefore, the matter is sent back to the original authority for de novo consideration to reconsider the claim of the appellant. If the facts stated above are found to be correct and the department is aware of the manner in which the goods were stocked in the open yard, then their claim is required to be accepted. The original authority shall readjudicate the matter within six months and by giving an opportunity of hearing to appellants and decide the matter in the de novo proceedings. The appeal is allowed by remand.