2015 (9) TMI 200 - AT - Central Excise

Remission of duty - Auto combustion - Whether the appellant is entitled for remission of duty in case of auto-combustion which took place in the factory of appellant or not - Held that - It is not in dispute that auto-combustion took place in the factory and molasses have been destroyed. To avoid the auto-combustion, the appellant has taken care to save the molasses. It is also on record that appellant has takes steps to save auto-combustion by way of spraying water to keep lower the temperature of tanks, recirculation of molasses and use of anti foaming agents. Nothing more has been suggested by the adjudicating authority to avoid auto combustion. Therefore, remission of duty cannot be denied in the light of decisions of Hon ble High Court of Allahabad 1998 (8) TMI 599 - Allahabad High Court and this Tribunal 2000 (5) TMI 316 - CEGAT, NEW DELHI . - accident of auto-combustion was beyond the control of appellant. Therefore the appellant is entitled for remission of duty as claimed. In these circumstances, I do not find any merit in the impugned order, same is set aside - Decided in favour of assessee.

Summary

Issues:
Appeal against the denial of remission of duty on molasses due to auto-combustion.

Analysis:
The appellant, a sugar and molasses manufacturer, stored molasses in tanks, leading to auto-combustion in tank No. 3, rendering 11048 qtls. of molasses unusable. The appellant's claim for remission of duty was rejected based on alleged lack of proper care and precautions. The appellant argued that they took measures like spraying water, recirculating molasses, and using anti-foaming agents to prevent auto-combustion, as supported by decisions like Basti Sugar Mill Company Ltd. and others.

The issue before the tribunal was whether the appellant is entitled to remission of duty for the auto-combustion incident. It was acknowledged that auto-combustion occurred, and the appellant had taken steps to prevent it, such as spraying water, recirculating molasses, and using anti-foaming agents. The tribunal noted that no additional precautions were suggested to avoid auto-combustion, leading to the conclusion that remission of duty cannot be denied based on precedents from the Hon'ble High Court of Allahabad and the tribunal.

Referring to various cases, including Basti Sugar Mills Ltd. and Balrampur Chini Mills Ltd., the tribunal emphasized that negligence was not evident on the appellant's part. The tribunal highlighted instances where manufacturers were granted remission of duty in similar circumstances, reinforcing the appellant's entitlement to remission in this case. The tribunal concluded that the auto-combustion incident was beyond the appellant's control, warranting remission of duty and overturning the impugned order. The appeal was allowed, with consequential relief granted.

This detailed analysis of the judgment showcases the appellant's efforts to prevent auto-combustion, the legal precedents supporting remission of duty in such cases, and the tribunal's decision to grant remission based on the circumstances and past rulings.