2009 (8) TMI 1062 - AT - Central Excise

Remission of duty - Rule 21 of CER, 2002 - the disputed issue placed befor Larger Bench as there were contrary views.

Summary

Issues:
Remission of duty for destroyed export goods under Rule 21 of Central Excise Rules, 2002.

Analysis:
The appellant, engaged in manufacturing excisable goods, cleared goods for export under ARE-1 without duty payment under bond, which were later destroyed in a fire accident before actual export. The appellant sought remission of duty for the destroyed goods under Rule 21 of Central Excise Rules, 2002. The dispute arose as lower authorities denied remission, stating that goods were already removed from the factory, making them ineligible for remission. The appellant argued that in the case of export goods, the place of removal extends up to the port area, entitling them to remission. They referenced Section 5 of the Central Sales Tax to support their claim that since the sale had not occurred and the goods were destroyed before loading, they should be granted remission under Rule 21.

Two conflicting views emerged in the field regarding remission for destroyed export goods. Some Tribunal decisions supported remission in such cases, citing instances where goods cleared for export but destroyed before export were eligible for remission. On the other hand, opposing Tribunal decisions contended against granting remission for destroyed export goods, emphasizing that the goods had already been removed from the factory. Due to the conflicting views, the matter was referred to the Hon'ble President for consideration on whether the issue should be presented before a Larger Bench for resolution. The judgment was pronounced on 21-8-2009 by Ms. Archana Wadhwa, J.