2008 (1) TMI 124

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..... pacity of 40,000 qtls. each. During 2002-03, there was bumper production of molasses and all the three tanks meant for storage of molasses became full a month earlier. In the circumstances, towards the end of April, 2003, additional molasses weighing 28,956.20 qtls. had to be kept in an open tank. Due to summer conditions, temperature rose resulting in material damage to the molasses kept in the open tank. The authorities of the State Excise and the Central Excise Departments were informed about the incident. The case of the appellant is that the rise in temperature leads to increase in the level of foaming and on the particular day, namely, 1-7-2003, the temperature rose to 45C. As a result, the molasses stored in the open tank turned into .....

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..... nt, the appellant having taken all possible steps in the matter, the remission, application should have been allowed. 4. On behalf of the Department it was stated that the claim of the appellant is not supported by the records. The claim is founded on supposition that all three tanks wherein molasses were kept, had been fully utilized and additional quantity of molasses only was kept in the open tank. From the records, however, it is manifest that in the three tanks in question, taken together, 107.828 qtls. of molasses only had been kept. The tanks having a combined storage capacity of 120.000 qtls. it will follow that 12,172 molasses more could be stored. The appellant having not utilized the tanks to their full capacity, the justificati .....

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..... could not have been kept in those tanks. It is relevant to mention that the molasses stored in the steel tank did not suffer any material damage on account of the rise in temperature, that is the same weather condition. Needless to say that the temperature level in the steel tanks, which were covered, was different from the temperature level in the open pit, which was more exposed to seen and vagaries of nature. In view of the above discussion, we hold that the appellant was entitled to remission of excise duty on 15,651 qtls. of molasses but not entitled to remission on the balance quantity, which could be kept in the steel tank. The liability of the appellant may be reassessed in the light of these findings and fresh demand be issued to t .....

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