Remission of excise duty on destroyed goods may still be reconsidered under the unfit-for-marketing proviso.

Remission of duty on cement lost in an accident was denied on the footing of unavoidable accident because the Commissioner found that adequate precautions had not been taken and that the loss resulted from mechanical failure, with no effective rebuttal by the assessee. Those factual findings were sustained. The second proviso to Rule 49(1) of the Central Excise Rules, 1944, however, separately permits remission where goods are unfit for consumption or marketing, subject to conditions imposed by the Commissioner. The matter was therefore remanded for fresh consideration only on that limited basis.

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Issues: Whether remission of duty on cement lost in an accident was admissible under Rule 49(1) of the Central Excise Rules, 1944, and whether the claim could be reconsidered under the proviso relating to goods found unfit for consumption or marketing.

Analysis: The remission claim based on unavoidable accident was rejected because the Commissioner recorded objective findings that adequate precautions were not taken and that the loss arose from mechanical failure, with no substantive rebuttal by the assessee. Those findings were upheld and no interference was called for on that aspect. However, the second proviso to Rule 49(1) also contemplates remission where goods are claimed to be unfit for consumption or marketing, subject to conditions imposed by the Commissioner. The claim appeared prima facie to fall within that proviso, and the matter required reconsideration on that limited basis.

Conclusion: Remission on the footing of unavoidable accident was not established, but the case was remanded to the Commissioner for fresh consideration of remission under the second proviso to Rule 49(1) of the Central Excise Rules, 1944.

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