Remission of duty for fire-destroyed excisable goods depends on unavoidable accident and loss within approved factory premises.

Remission of duty is admissible for excisable goods destroyed by fire within the licensed factory premises under Rule 49 of the Central Excise Rules, 1944, where the loss results from an unavoidable accident before removal. The destruction by an electric short circuit was undisputed, and temporary storage in an approved area did not defeat entitlement because the officers were informed and verified the loss. Denial could not be sustained on alleged negligence or on the absence of insurance-claim details, as those factors did not affect the statutory right to remission. The rule was to be applied liberally to give effect to its object.

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Issues: Whether remission of duty was admissible for excisable goods destroyed by fire within the factory premises under Rule 49 of the Central Excise Rules, 1944, and whether denial could be sustained on the grounds of alleged negligence, storage in a temporary godown, or non-production of insurance-related details.

Analysis: Rule 49 permits remission where excisable goods are lost or destroyed by natural causes or unavoidable accident before removal from the factory or approved storage. The destruction of the goods by fire due to an electric short circuit was undisputed, and the loss occurred within the licensed factory premises. The temporary storage arrangement did not defeat the claim because the premises were approved and the officers had been informed and had verified the loss. The absence of production of insurance-claim details had no bearing on entitlement to remission. The interpretation of the rule had to be liberal so as to effectuate its object, and mere absence of deliberate misconduct or mala fides supported the claim.

Conclusion: Remission of duty was admissible, and denial on the grounds relied upon by the department was unsustainable. The issue is decided in favour of the assessee.

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