2001 (4) TMI 392 - AT - Central Excise

Summary

Issues:
1. Rejection of remission claim by the Commissioner of Central Excise.
2. Lack of show cause notice and personal hearing for the remission claim.
3. Contradiction in orders regarding the auto-combustion incident.
4. Interpretation of Rule 49 of the Central Excise Rules.
5. Requirement of a speaking order by the Commissioner.
6. Necessity for remand for fresh adjudication.

Analysis:
1. The appellants, manufacturers of sugar and molasses, appealed against the rejection of their remission claim by the Commissioner of Central Excise, Lucknow. The claim was for a quantity of molasses allegedly destroyed in auto-combustion. The appellants argued that they were not given a show cause notice or a personal hearing before the rejection of their claim. Additionally, there was a discrepancy between the acceptance of the auto-combustion incident in one order and its rejection in another.

2. The legal representative for the appellants contended that the Commissioner's decision lacked proper communication and that the matter required fresh adjudication in line with the principles of natural justice. The Senior Departmental Representative did not oppose the remand, acknowledging the lack of clarity in the Additional Commissioner's letter.

3. Rule 49 of the Central Excise Rules allows for remission of duty on molasses due to loss or destruction by natural causes. The appellants needed to establish the loss to the satisfaction of the Commissioner, who acts in a quasi-judicial capacity. The absence of a show cause notice and personal hearing hindered the appellants from proving the loss, and the Commissioner's duty was not fulfilled.

4. The judgment emphasized the importance of a speaking order by the Commissioner and the need for proper communication with the assessee. The Commissioner was directed to reconsider the matter, issue a speaking order, and provide a reasonable opportunity for a personal hearing to the party. The decision was to be independent of any previous orders related to the same facts.

5. Ultimately, the appeal was allowed for remand to the Commissioner for a fresh decision in compliance with legal requirements and principles of natural justice. The Commissioner of Central Excise, Lucknow, was instructed to address the issues involved in the case after granting a fair opportunity for a personal hearing to the appellants.