Molasses shortage within permitted variation cannot justify denial of remission or the related duty demand.

Remission of duty on shortage of molasses cannot be denied where the shortage remains within the permissible variation fixed by the applicable Board circular. The text notes that a 0.37% shortage fell within the 2% tolerance allowed for molasses under Circular No. 261/15/1982-CX.8 dated 18-07-1983, so the procedural objection to remission did not justify rejection. On the same factual basis, the consequential duty demand was also unsustainable. The stated principle is that a shortage within the recognised percentage variation does not support denial of remission or the related duty demand.

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Issues: Whether remission of duty on shortage of molasses was to be denied for alleged non-compliance with procedure, and whether the shortage justified duty demand.

Analysis: The shortage in molasses was found to be only 0.37%, which fell within the 2% variation permitted by the Board's Circular No. 261/15/1982-CX.8 dated 18-07-1983 for molasses. The revisionary authority had already set aside the consequential duty demand on the same factual basis. In these circumstances, the rejection of remission could not be sustained.

Conclusion: The denial of remission was not justified and the appeal succeeded.

Ratio Decidendi: Where the shortage in molasses is within the permissible percentage variation allowed by the applicable Board circular, rejection of remission and the consequential duty demand cannot be sustained.

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