2003 (5) TMI 113 - AT - Central Excise

Summary

Issues:
1. Entitlement to remission of duty on excisable goods destroyed by fire.
2. Interpretation of "unavoidable accident" in Rule 49 for remission.

Issue 1: Entitlement to remission of duty on excisable goods destroyed by fire:
The appeal considered whether the appellant should receive remission of duty on excisable goods destroyed by a fire at their factory. The fire was accidental, not caused by natural or deliberate means. The Commissioner denied remission, stating that the accident was avoidable due to a carelessly thrown cigarette butt. However, the appellant argued that no negligence was proven, and the fire was an unavoidable accident. The insurance report only presumed the cause of the fire, lacking certainty. The Tribunal noted that the fire's cause was not definitively established, and there was no evidence of negligence by the manufacturer. The Tribunal concluded that the fire was an unavoidable accident, as reasonable precautions were taken, and negligence was not proven.

Issue 2: Interpretation of "unavoidable accident" in Rule 49 for remission:
The judgment delved into the meaning of "unavoidable accident" in Rule 49. An accident, by definition, is an unforeseeable event that reasonable care could not prevent. If an accident is avoidable, it does not qualify as an accident. The term "unavoidable accident" implies an incident not caused by negligence or willful omission, despite reasonable precautions taken. The judgment emphasized that there was no evidence of negligence by the manufacturer in preventing the fire. Referring to a previous case, the Tribunal highlighted that when the cause of a fire is unascertainable, it is deemed unavoidable. The judgment distinguished a previous case where remission was denied due to insufficient care in transporting goods, which did not apply in the present scenario. Consequently, the Tribunal allowed the appeal, setting aside the Commissioner's order and granting remission of duty to the appellant.