Strict compliance with destruction procedure governs excise duty remission, and unilateral destruction before permission defeats relief.

Remission of Central Excise duty on destroyed goods was available only on strict compliance with Rule 21, including a proper application, supporting proof of unfitness for consumption or marketing, and destruction only after prior permission and supervision. Where the assessee destroyed the goods on its own before permission was granted and without following the prescribed procedure, remission was rejected. Once remission failed, the consequential demand of duty, interest and penalty on the destroyed goods was sustained, and the challenge to that demand also failed.

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Issues: (i) Whether remission of Central Excise duty could be granted when the goods were destroyed before obtaining permission and without following the prescribed procedure under Rule 21 of the Central Excise Rules, 2002; (ii) Whether the consequential demand of duty, interest and penalty on the destroyed goods was sustainable.

Issue (i): Whether remission of Central Excise duty could be granted when the goods were destroyed before obtaining permission and without following the prescribed procedure under Rule 21 of the Central Excise Rules, 2002.

Analysis: Rule 21 required an application to the proper authority, supporting proof that the goods had become unfit for consumption or marketing, and destruction only after permission and supervision. The appellant did not furnish the required details or test report, destroyed the goods on its own before any permission was granted, and informed the department only after destruction. The prescribed procedure was therefore not followed.

Conclusion: The claim for remission was rightly rejected and the finding is against the assessee.

Issue (ii): Whether the consequential demand of duty, interest and penalty on the destroyed goods was sustainable.

Analysis: Once remission was declined, the duty liability on the goods remained. The Tribunal found no basis to interfere with the consequential demand, and the challenge to the confirmation of duty, interest and penalty failed with the remission claim.

Conclusion: The consequential demand of duty, interest and penalty was sustained and the finding is against the assessee.

Final Conclusion: The appeals failed in full, and the rejection of remission as well as the consequential demand was upheld.

Ratio Decidendi: Remission of excise duty on destroyed goods is available only on strict compliance with the prescribed procedure, including prior permission and supervision of destruction; destruction undertaken unilaterally before such compliance disentitles the assessee to remission and sustains the consequential duty demand.

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