Remission of duty for fire-damaged perishable goods cannot be denied solely for procedural non-compliance when destruction is established.

Rule 21 of the Central Excise Rules, 2002 allows remission of duty where excisable goods are destroyed or rendered unfit for consumption. In the case of perishable goods damaged in a fire, the substantive entitlement to remission could not be denied merely because every procedure in departmental instructions was not followed, where the fire, timely intimation, departmental visit, segregation and destruction of the goods, and a destruction certificate were all established. The strict manual procedure could not be applied mechanically to defeat proved destruction. Accordingly, remission was admissible and the consequential duty demand could not survive.

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Issues: Whether remission of duty was to be denied for destruction of perishable excisable goods damaged in a fire accident on the ground of non-observance of the procedure prescribed in the departmental instructions, and whether the duty demand raised as a consequence of such denial could survive.

Analysis: Rule 21 of the Central Excise Rules, 2002 permits remission of duty where excisable goods are destroyed or rendered unfit for consumption. The fire incident, timely intimation to the department, visit of the Range Superintendent, subsequent segregation and destruction of the damaged goods in the presence of a surveyor, and issuance of a destruction certificate were not disputed. The goods were a perishable product requiring preservation at a low temperature, and the strict procedure in the manual could not be mechanically applied to defeat the substantive entitlement when the destruction of goods was otherwise established.

Conclusion: Remission of duty was rightly admissible, and denial of remission solely for procedural non-compliance was unsustainable. The consequential duty demand also could not survive.

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