Duty on unfit excisable goods must be tested under the remission proviso before demand is confirmed

Excisable molasses that had solidified in storage and were claimed to be unfit for marketing or consumption had to be examined under the full excise rule, not only the proviso dealing with loss or destruction by natural causes or unavoidable accident. The rule also contained a separate proviso enabling the proper officer to decline duty where goods are unfit for consumption or marketing, subject to conditions for disposal. Because the demand was confirmed without considering that alternative basis and the request for destruction with safeguards, the demand order was set aside and the matter remanded for fresh consideration in accordance with law.

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Issues: Whether duty could be demanded on excisable molasses that had solidified in storage and were claimed to be unfit for marketing, and whether the request for destruction and remission required consideration under the applicable excise rules.

Analysis: The goods were not found to have been totally destroyed, but they had solidified because of excessive heat and were claimed to be unfit for marketing and consumption. The relevant rule contained not only a proviso dealing with loss or destruction by natural causes or unavoidable accident, but also a separate proviso empowering the proper officer not to demand duty on goods claimed to be unfit for consumption or marketing, subject to conditions imposed for disposal. The demand had been confirmed only by treating the matter as one governed by the first proviso, without considering whether the goods fell within the second proviso and whether permission for destruction should be granted with appropriate safeguards.

Conclusion: The demand order was set aside and the matter was remanded for fresh consideration of the request for destruction and remission in accordance with law.

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