Remission of duty for unfit goods depends on factual compliance and timely notice, not a different scrap ruling.

Questions concerning remission of duty under the second proviso to Rule 49(1) of the Central Excise Rules, 1944, were treated largely as factual rather than referable legal questions. On the facts, the manufacturer had informed excise authorities that the goods had become unfit for consumption or marketing and had notified the intended destruction dates; the authorities' failure to respond in time did not justify denial of remission. The Supreme Court ruling on copper waste and scrap was held inapplicable because it concerned a different marketable-scrap context and did not control the scope of the proviso. The reference applications were therefore rejected as not fit for reference.

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Issues: Whether the questions raised by the Collector, including the applicability of remission of duty under the second proviso to Rule 49(1) of the Central Excise Rules, 1944, were fit for reference to the High Court.

Analysis: The questions other than the challenge to the Tribunal's treatment of the earlier decision were found to be questions of fact. On the facts, the respondent had kept the Central Excise authorities informed that the goods had become unfit for consumption or marketing and of the proposed destruction dates. Where the authorities did not respond in time, denial of the benefit under the second proviso to Rule 49(1) was not justified. The reliance placed on the Supreme Court decision concerning copper waste and scrap was held to have no application, since that decision dealt with a different context of marketable scrap and did not determine the scope of the second proviso to Rule 49(1).

Conclusion: The questions raised were not fit for reference, and the reference applications were rejected.

Ratio Decidendi: Where goods have become unfit for consumption or marketing and the manufacturer has informed the excise authorities, a timely failure by the authorities to act does not necessarily defeat remission under the second proviso to Rule 49(1) of the Central Excise Rules, 1944, and fact-specific questions on such compliance are not ordinarily referable as questions of law.

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