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of <h1>High Court directs reexamination of vague adjudication order lacking specificity on preventive measures</h1> <h3>Oudh Sugar Mills Ltd. Versus Collector, Central Excise And Others</h3> The High Court found the original adjudication order lacking in specificity regarding the preventive measures expected from the petitioner in the case of ... Levy of excise duty - loss of molasses in a fire - Held that:- When an excisable commodity is lost on account of fire, Assessee is not absolved of obligation of payment of duty but circumstances wherein duty can be remitted are provided in Rule 147 of Central Excise Rules, 1944 - In the present case, dispute relates to molasses which are capable of getting lost due to auto combustion, which is a natural phenomena. However, if certain preventive measures are to be taken and such measures were not taken by Assessee, no remission of duty can be done. If loss is attributable to negligence of assessee, he may be liable to pay duty. It is evident that factum that molasses is capable of auto combustion is an admitted fact and it is also admitted that it is a natural phenomena but remission has been denied to the petitioner on the ground that he failed to take preventive measure but what preventive measure could not be taken by petitioner to prevent loss of molasses due to fire, nothing is stated in the notice issued earlier nor in the order of adjudication dated 03.01.1989 - Since department never confronted that petitioner has not taken such preventive measures as required and impugned order has been passed by assuming that such preventive measures have not been taken, the order is non speaking and unsustainable. Matter needs reconsideration - appeal allowed by way of remand. Issues:Challenge to adjudication order demanding Central Excise duty on account of loss of molasses in a fire.Analysis:The High Court examined the adjudication order dated 03.01.1989, which imposed excise duty on the petitioner due to the loss of molasses in a fire caused by auto combustion. The petitioner argued that the order did not specify what preventive measures should have been taken to avoid the fire, especially since auto combustion in molasses is a recognized natural phenomenon. The Court highlighted Rule 147 of the Central Excise Rules, 1944, stating that duty remission is possible in case of unavoidable accidents. However, if preventive measures were not taken by the Assessee, duty liability remains. The Court noted that while auto combustion in molasses is acknowledged as a natural occurrence, the order failed to detail the specific preventive measures the petitioner should have taken. Consequently, the Court deemed the order non-speaking and unsustainable, emphasizing the need for a reexamination by the Adjudicating Authority to provide a fresh notice outlining the alleged preventive measures and issuing a new order in compliance with the law.The Court concluded that the original adjudication order lacked a proper opportunity for the petitioner to present their case and directed the Adjudicating Authority to issue a new notice specifying the preventive measures expected from the petitioner. The Court emphasized that the subsequent adjudication order must be a speaking order, providing detailed reasoning and considerations.
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