2005 (2) TMI 753 - AT - Central Excise

Summary

Issues:
The appeal against rejection of remission of duty applications.

Details:
The appellant filed 17 applications from May 1998 to March 2002 seeking remission of duty for breakage of aerated water bottles. The appellant argued that no duty is payable on goods lost due to breakage, citing Circular No. ID/3/70-CX. dated 8-9-1971 of the Board which advised a condonation of breakage within 0.5%. The appellant's breakage rate was 0.07%, well within the norm. However, the Commissioner rejected the claim citing late intimation by the assessee.

The learned counsel argued that except for a slight delay in filing applications for May to August 1999, there was no significant delay. They contended that as per Board's instructions, remission applications should be considered through verification of accounts and records during investigation. The appellant's claim fell under the proviso to Rule 49, which states that duty need not be paid for goods lost due to unavoidable accidents during handling or storage.

No duty demand was raised independently for the lost goods, and the quantities claimed as lost due to breakage were insignificant and below the norm set by the Board Circular. The Tribunal found the appellant's claim to be bona fide and correct, as similar applications had been allowed for their other units. The delay in filing the claim was deemed inconsequential, and the appeal was allowed, setting aside the rejection order and granting the appellant consequential relief.