1986 (8) TMI 300 - AT - Central Excise

Summary

Issues:
- Appeal against rejection of remission of Central Excise duty on neutralised waste
- Interpretation of Rule 49 and Rule 147
- Evidence of loss due to floods
- Collector's findings and reasoning
- Compliance with reporting requirements
- Application of legal precedents

Analysis:

The appeal before the Appellate Tribunal CEGAT, Bombay involved M/s Polymers Corporation of Gujarat Ltd. challenging the rejection of their request for remission of Central Excise duty on neutralised waste. The appellants, a Govt. of Gujarat Corporation, had paid duty amounting to Rs. 35,650 under protest after heavy rains caused extensive damage to the waste. The Collector rejected the remission request citing the discovery of loss by the Range Supdt. and the absence of empty bags for verification. The appellants argued that the loss was genuine due to floods and reported to the authorities, fulfilling the requirements of Rule 49. They also contended that Rule 147 was wrongly invoked in the show cause notice. The Respondent, however, disputed the evidence of loss and compliance with reporting obligations, supporting the Collector's decision.

The Tribunal considered the submissions of both parties and evaluated the Collector's findings. It noted the failure of the Collector to consider the correspondence between the appellants and the Supdt., which confirmed the loss due to heavy rains. The Tribunal emphasized that the heavy rainfall was a known fact and no further evidence was required. It also highlighted the implausibility of surreptitious removal of a large quantity of goods by a government entity like the appellants. The Tribunal criticized the Collector's reasoning for disregarding the appellants' explanation of loss and the absence of bags, stating it did not reflect a judicious approach. Ultimately, the Tribunal found the appellants' request for remission genuine and bonafide, setting aside the Collector's order and granting remission of duty amounting to Rs. 35,650.

In its analysis, the Tribunal focused on the interpretation of Rule 49 and Rule 147, the evidence of loss due to floods, the Collector's findings and reasoning, compliance with reporting requirements, and the application of legal precedents. The decision emphasized the importance of considering all relevant evidence and applying the law judiciously to determine the genuineness of the remission request in cases of natural calamities affecting excisable goods.