Duty remission on excisable goods requires proof of natural loss or unavoidable accident, not foreseeable risk or unauthorised storage.

Remission of duty for loss of excisable goods is available only where the claimant proves that the loss arose from natural causes or an unavoidable accident. Unauthorised storage of molasses in kutcha pits in a flood-prone area, without departmental permission, did not satisfy that requirement because the risk of loss was foreseeable and due diligence was lacking. Mere non-removal of goods from the factory or warehouse was also insufficient to justify remission unless the loss itself was shown to fall within the recognised grounds. On those facts, the original demand was restored and remission was unavailable.

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Issues: (i) Whether remission of duty was allowable on loss of molasses stored in kutcha pits after flooding, where the storage was unauthorised and the loss was not shown to have been caused by natural causes or unavoidable accident; (ii) Whether mere non-removal of the goods from the factory premises was sufficient to justify remission.

Issue (i): Whether remission of duty was allowable on loss of molasses stored in kutcha pits after flooding, where the storage was unauthorised and the loss was not shown to have been caused by natural causes or unavoidable accident.

Analysis: Remission depends on proof that the loss was occasioned by natural causes or an unavoidable accident. The burden lies on the claimant to establish that the loss occurred without foreknowledge or control. Where molasses were shifted from steel tanks to kutcha pits without departmental permission, in a flood-prone area, the risk of loss could reasonably be foreseen. Unauthorised and insecure storage, therefore, did not satisfy the conditions for remission.

Conclusion: The claim for remission was not sustainable and was decided against the assessee.

Issue (ii): Whether mere non-removal of the goods from the factory premises was sufficient to justify remission.

Analysis: Non-removal from the factory or warehouse does not by itself establish loss due to natural causes or unavoidable accident. Remission cannot rest solely on the fact that the goods remained within the premises if the circumstances show lack of proper diligence and foreseeable exposure to loss.

Conclusion: Mere non-removal from the premises was insufficient to support remission and the point was decided against the assessee.

Final Conclusion: The review authority set aside the appellate order and restored the original demand, holding that remission was unavailable on the facts proved.

Ratio Decidendi: Remission of duty for loss of excisable goods is available only when the claimant proves that the loss resulted from natural causes or an unavoidable accident, and not from foreseeable risk, unauthorised storage, or lack of due diligence.

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