Remission of duty on fire-destroyed goods allowed; Cenvat credit reversal not required on the facts considered.

Where goods destroyed by fire before the later amendment to the excise rules, remission of duty was available and reversal of Cenvat credit was not required on the facts considered. The Gujarat HC treated the questions on remission and credit reversal as interconnected and relied on an earlier Full Bench ruling concerning destruction of final products and input credit. On that basis, destruction by fire was accepted as an unavoidable event for remission purposes, and the assessee's claim was allowed against the Revenue.

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Issues: Whether reversal of Cenvat credit was required for claiming remission of duty in respect of goods destroyed by fire, and whether such destruction could be treated as an unavoidable event attracting remission under the relevant excise rules.

Analysis: The questions were treated as interconnected and answered together. Reliance was placed on the earlier Full Bench decision on remission of duty where final products are destroyed and the credit taken on inputs used in their manufacture. The relevant statutory position was that, where goods are destroyed by fire and the remission application was made before the later amendment came into force, the assessee was entitled to claim the benefit of Cenvat credit. On that basis, reversal of credit was not required on the facts considered.

Conclusion: The questions were answered in favour of the assessee and against the Revenue.

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