2002 (10) TMI 161 - AT - Central Excise

Summary

Issues:
Appeal against rejection of duty remission due to goods destruction by fire.

Analysis:
1. Facts and Background: The appellants, engaged in manufacturing polyester filament yarn, sought remission of duty for 236000.77 kgs. of spinning hard waste destroyed in a fire at their factory. The Commissioner rejected their claim citing delay in intimation to fire brigades and uncertainty about the fire's cause.

2. Arguments: The appellants contested the Commissioner's findings, asserting timely intimation to fire brigades and providing the cause of fire as immense heat. The SDR supported the Commissioner's decision.

3. Evaluation of Timeliness: The Tribunal noted the fire broke out at 13:50 hrs, with intimation sent to fire brigades at 14:30 hrs and 14:55 hrs, a delay of 40 and 65 minutes respectively. The Tribunal deemed this delay reasonable, rejecting the Commissioner's assertion that timely intimation could have prevented the loss.

4. Cause of Fire: The appellants attributed the fire to intense summer heat, a claim consistent with the fire brigade's report. The Inspector's visit post-fire did not dispute this cause, and no evidence suggested the goods were non-inflammable or lacked lumps formation.

5. Legal Provisions: Rule 49 of the Central Excise Rules absolves duty payment for goods lost by natural causes. The Tribunal found the fire, due to immense heat, qualified as an act of God, justifying duty remission for the destroyed goods.

6. Additional Duty Claim: The appellants raised a separate argument regarding duty liability only for consumed goods, but the Tribunal deemed this issue beyond the scope of the current appeal, focused on the duty remission rejection.

7. Decision: The Tribunal set aside the Commissioner's order, allowing the appellants' appeal for duty remission due to the fire-induced goods loss. The ruling emphasized the appellants' successful proof of loss by natural causes, warranting relief under Rule 49.

In conclusion, the Tribunal overturned the Commissioner's decision, granting the appellants duty remission for goods destroyed by fire, highlighting the adequacy of evidence supporting the fire's natural cause and the timely actions taken by the appellants.