Export in bond remains conditional: fire loss before export did not extinguish excise duty liability under the rules.

Removal of excisable goods for export in bond under the Central Excise Rules, 1944 operated only as a conditional postponement of duty, not as a substantive exemption. Where export was not completed because the goods were destroyed by fire after removal from the factory, duty remained demandable unless the rules expressly provided remission. The bond executed under Rule 14 was only supplementary security and could not override the statutory liability under Rule 14-A. Proviso (c) to Rule 14-A was limited to preventing penal action where goods were satisfactorily accounted for; it did not waive duty. Insurance recovery was separate and had no effect on excise liability.

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Issues: Whether central excise duty was payable on goods removed for export in bond under the Central Excise Rules, 1944, when the goods were destroyed by fire before export, and whether proviso (c) to Rule 14-A or the execution of the bond relieved the exporter from liability.

Analysis: The removal of excisable goods for export under Rule 13 operated only as a postponement of duty and did not itself create an exemption. Rule 14 required execution of a bond, but the bond was only supplementary security and could not override the statutory liability created by Rule 14-A. Rule 14-A provided for immediate demand of duty where export was not completed, and proviso (c) only prevented resort to the penal machinery where the goods had been accounted for to the Collector's satisfaction. It did not confer a power to waive or remit duty. Remission was available only where the Rules expressly so provided, and the fire-loss of goods after removal from the factory and outside the bonded store-room did not attract any such remission. The insurance settlement was a separate matter and did not affect the excise liability.

Conclusion: Duty remained demandable notwithstanding destruction of the goods before export, and proviso (c) to Rule 14-A did not exempt the exporter from payment. The liability under Rule 14-A was upheld and the bond did not defeat it.

Final Conclusion: The statutory scheme treated export in bond as conditional, and failure to complete export exposed the goods to duty demand in the absence of an express exemption or remission provision.

Ratio Decidendi: Where excisable goods are removed for export in bond, destruction of the goods before export does not extinguish duty liability unless the governing rules expressly provide for exemption or remission; a proviso preventing penal action for duly accounted goods cannot be read as a substantive waiver of duty.

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