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TMI Blog1973 (7) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... e full amount of duty chargeable thereon, together with all rent, penalties, interest and other charges payable on the account of the goods. In view of this provision the Deputy Superintendent, M.O.R.I. Chilakalurpet issued a notice to the petitioner stating that under Rule 160 the petitioner was to pay duty on 82,839 kgs. of tobacco scrap. The amount of duty was calculated at Rs. 2,60,114.46P. It was also stated in the notice that the existence of damaged VFC tobacco in these sheds were accepted by the petitioner in the statement dated 23-6-1966 given by the managing partner. It was further stated that as these two sheds were not approved premises for storage of tobacco the question of remission of any duty on the quantity damaged or destroyed in these sheds cannot be considered. The petitioners gave a reply dated 30-7-1966. They stated that they never stored or deposited any tobacco in the thatched sheds. They objected to the estimate of the quantity of tobacco made in the order. They pointed out that the nature of the accident was so sudden that it was beyond the control of the licensee to stop the fire. They requested the remission may be given and the demand notice may be with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted that scrap of tobacco weighing 82,839 kgs. were gutted and the Board did not find any justification for interfering with the order passed by the Collector. The appeal was accordingly rejected. As against this order, the petitioner preferred a revision petition to the Government of India. By an order dated 23-11-1971 the Government of India dismissed the revision petition. It was contended before them that the Collector's estimate of the scrap which was destroyed by fire was not correct and was not based upon any reasonable basis. This contention was rejected and the Government of India held that Collector's method was not unreasonable as it was based on the records and the petitioner's did not originally contest the figure. The petitioners also contended before the Government of India that they should be granted remission under Rule 147 which authorised the Collector to estimate the duty due to his discretion, if any goods lodged in a warehouse and lost or destroyed by unavoidable accident. The petitioners contended that the Collector ought to have granted remission in full and not merely on half. The Government of India observed that the rule vests the Collector with powers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the circumstances of the case. It is true, in the case there is no dispute that the accident was unavoidable, but merely because the accident was unavoidable, it does not automatically follow that the Collector is bound to grant remission of the whole duty payable. If that argument were to be accepted then there is no discretion left in the Collector at all. As in every case of unavoidable accident, he is bound to remit the entire duty. Shri Choudary endeavoured to argue that under Rule 147 the discretion was only in coming to the conclusion whether the accident was unavoidable or not. This submission is contrary to the language of Rule 147. Under that rule, the occasion for remission arise only when the goods are lost or destroyed by unavoidable accident. The discretion cannot have any reference to the nature of the accident. The discretion has only reference to the remission of the duty. The Collector must first come to the conclusion that there was unavoidable accident and then exercise his discretion with regard to the duty to be remitted. 7. It was further contended by Shri Choudary that Rule 160 applies only in cases where Rule 147 has no application as under Rule 160 the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here was no, such undertaking it does not stand in the way of the Collector granting remission of the duty, if the conditions laid down in Rule 147 are satisfied. The undertaking given by the petitioners has been set out already and in that undertaking to the petitioners stated that they were aware that no remission of Central Excise duty will be allowed in case of fire accident in respect of all the tobacco stored or handed in their thatched sheds. It is argued that this is not an undertaking not to claim remission, but only a statement that they were aware that no remission will be allowed. Even assuming that is the proper interpretation of this document, I do not think the Collector was not justified in taking this as one of the circumstances in considering the question of remission. If a person with open eyes applied for a licence for a premises which includes thatched sheds and says that he is aware that no remission of Central Excise duty will be allowed in case of fire accident, it is not unreasonable for the Collector to take that circumstance into consideration in deciding whether remission should be granted in full or in part. It is true that the mere fact of giving an un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or (c) that he based his decision on some wholly extraneous consideration or (d) that he failed to have regard to matters which he should have taken into account." 12. At page 969 Lord Upjohn observed that if the Minister does not give any reason for his decision it may be, if circumstances warrant it, that a Court may be at liberty to come to the conclusion that he had no good reason for reaching that conclusion and order a prerogative writ to issue accordingly. I am not satisfied in this case that the exercise of discretion by the Collector is vitiated by any of the circumstances referred to in the above case. It is to be remembered that in this case the exercise of discretion is in respect of remission of a duty and not in respect of confirmation of a right, privilege or licence which often comes up before Courts. In this case, primarily the goods were liable to duty under Rule 160 but the petitioner could ask for remission in case of unavoidable accident. There is no right in the petitioner to claim remission. The Collector has to exercise discretion and consider whether a case for remission of duty was made out. The approach to the exercise of discretion in the case of remis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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