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Issues: Whether remission of duty was admissible for molasses lost during storage and handling, and whether such loss could be treated as arising from unavoidable accident.
Analysis: The claim for remission had to be tested against the proviso to Rule 49 and Rule 21 of the Central Excise Rules. The proviso to Rule 49 expressly covered loss during storage as well as handling, while Rule 21 permitted remission where goods were lost or destroyed by natural causes or by unavoidable accident before removal. The loss in question was found to be very small and was attributable to unavoidable loss during handling and storage. The absence of separate data for spillage and storage loss did not justify rejection of the claim where the overall loss fell within the range of unavoidable loss contemplated by the rules.
Conclusion: Remission of duty was admissible and the denial of remission was unsustainable, in favour of the assessee.
Final Conclusion: The impugned orders were set aside and the appeals succeeded with consequential relief, if any.
Ratio Decidendi: Loss of excisable goods during handling or storage, when attributable to unavoidable accident and otherwise satisfactorily explained, qualifies for remission of duty under the remission rules.
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