Molasses storage loss within the Board's condonable limit could not justify refusing remission under the circular.

Remission of molasses loss could not be refused where the reported storage loss was within the 2% limit treated as condonable under the Board circular dated 18-7-1983 for molasses stored in kuchha pits or steel tanks. Because the claimed loss fell within that prescribed tolerance, the explanation for the loss was not liable to be rejected merely on the ground that the cause had not been satisfactorily established in the impugned order. The rejection of remission was therefore unsustainable, and relief was granted to the assessee.

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Issues: Whether remission of molasses loss was rightly rejected when the storage loss was stated to be less than 2% and covered by the Board circular.

Analysis: The appeal turned on the effect of the Board circular dated 18-7-1983, which treated loss up to 2% of molasses stored in kuchha pits or steel tanks as condonable. The appellants had reported the storage loss and the claimed loss was found to be within that limit. In view of the circular, the explanation for the loss could not be rejected merely on the footing that the cause had not been satisfactorily established in the impugned order.

Conclusion: The rejection of remission was unsustainable and the appeal was allowed in favour of the assessee.

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