Cenvat Credit on duty-paid molasses lost in storage remains admissible; remission rules do not apply.

Dispute over duty-paid molasses lost during storage was treated as a Cenvat credit matter, not a remission of duty case, because remission applies to non-duty-paid goods and the credit had already been availed on duty-paid inputs. The jurisdictional objection based on remission was rejected. On merits, the matter followed the prior view that credit remains admissible where molasses is lost in transit or storage, so denial of Cenvat credit was unsustainable and the appeals succeeded.

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Issues: Whether the dispute concerned admissibility of Cenvat credit on duty-paid molasses lost during storage and whether the proceedings could be treated as a remission of duty matter outside the Tribunal's jurisdiction.

Analysis: The appeal arose from show cause notices proposing denial of Cenvat credit on molasses reported as lost during storage. The subsequent departmental review and appellate order proceeded on the basis of remission of duty and the competence of the Assistant Commissioner to condone loss, but the underlying controversy was not one of remission. Remission would arise in respect of non-duty-paid goods, whereas the present case concerned duty-paid molasses on which credit had already been availed. The jurisdictional objection was therefore rejected. On merits, the dispute was covered by the prior decision holding credit admissible where molasses is lost in transit or storage.

Conclusion: The matter was held to be a Cenvat credit dispute, not a remission of duty case, and the denial of credit was unsustainable. The appeals succeeded.

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