Correct excise provision must be applied before sustaining duty demand on goods allegedly destroyed by fire.

Rule 147 of the Central Excise Rules, 1944 applies to warehoused goods lost or destroyed by unavoidable accident, while the proviso to Rule 49(1) concerns goods lost or destroyed by natural causes or unavoidable accident during handling or storage in approved premises. The authorities treated the remission issue as concluded under Rule 147 without examining the claim under Rule 49 or the actual record, including the alleged order of 7-6-2002. The demand could not be sustained on that basis. The impugned order was set aside and the matter remanded for fresh decision after hearing both sides.

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Issues: Whether the demand of duty on goods alleged to have been destroyed by fire before removal was sustainable under Rule 49 of the Central Excise Rules, 1944, or whether the authorities were right in proceeding only on the basis of a remission decision under Rule 147 of the Central Excise Rules, 1944.

Analysis: The claim for remission was treated by the authorities below as if it were governed by Rule 147, but the record did not contain the order said to have been passed on 7-6-2002, and neither authority examined its legal basis. Rule 147 applies to warehoused goods lost or destroyed by unavoidable accident, whereas the proviso to Rule 49(1) concerns goods lost or destroyed by natural causes or unavoidable accident during handling or storage in store-room or other approved premises. The two provisions operate in distinct fields, and the question whether the goods were properly accounted for and whether duty could be demanded had to be examined under the correct provision on the facts.

Conclusion: The authorities below erred in treating the matter as concluded by the alleged remission rejection under Rule 147 without examining the claim under Rule 49. The demand could not be sustained on that basis, and the matter required reconsideration.

Final Conclusion: The impugned order was set aside and the matter was remanded to the adjudicating authority for a fresh decision after hearing both sides.

Ratio Decidendi: Where competing excise provisions govern different factual situations, the authority must apply the correct provision on the basis of the actual nature of the goods and the record, and a demand cannot be sustained without examining the claim under the applicable rule.

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