TaxTMI 
TaxTMI 
2016 (7) TMI 233
X X X X Extracts X X X X
X X X X Extracts X X X X
....06.2008, it was noticed that 7.921 M.T. of LAB were short shipped/not exported by the applicants. The applicants requested for remission of duty in respect of shortage of LAB due to evaporation loss during transit, under Rule 21 of Central Excise Rules, 2002, to the jurisdictional Assistant Commissioner, as the loss was claimed to have within the permissible limit prescribed by the Board's Circular No.292/8/97-CX dated 24.01.1997 in respect of Natural Gasoline Liquid (NGL). The applicants were directed to pay the duty on the 7.921 M.T. of goods cleared from the factory, but not exported from the place of export, which they failed to do so. Accordingly, a Show Cause Notice was issued for recovery of Central Excise duty amounting to Rs. 85,435/-, interest at the appropriate rate and proposing for imposition of penalty under Rule 25 of Central Excise Rules, 2002 read with Section 1 IAC of the Central Excise Act, 1944. The Show Cause Notice was adjudicated by the impugned Order-in-Original dated 17.03.2009 confirming Central Excise duty of Rs. 85,435/L along with interest at the appropriate rate and imposing a penalty of Rs. 85,435/- under Rule 25 of Central Excise Rules, 200....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ue to natural causes or accident etc. Unfortunately the Commissioner (Appeals) has neither discussed nor given any findings but turned down, as they are not relevant. In fact he was bound to give the proper findings as to how and why the cited decisions are not relevant in the present case. This has not been done. Therefore, the impugned order is apparently violative of principals of natural justice. 4.5 It is further submitted that is true that the administrative instructions issued by the Board may not be binding on the adjudicating and Appellate authorities who perform quasi-judicial officers. But then, the object of the administrative instructions is to achieve uniformity in the matter of condonation of evaporation and handling loss, it is desirable to have due regard to such administrative instruction by the authorities. Except stating that certain loss on certain dates are abnormal, the adjudicating officer nor the appellate Commissioner has given any reasons for non-consideration to remit the duty. The Commissioner (Appeals) being quasi-judicial authority is required to assign reasons for not allowing the permissible condonation of loss and not allowing remission of duty ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 4.8 That it is further submitted that remission of duty for any excisable goods is specifically provided in Rule 21 of Central Excise Rules subject to condition that the loss or shortage of goods must be due to natural causes and not for any other reason. In the present caser the Department itself has accepted that the short quantity is due to natural causes and the short quantity has not been removed clandestinely or disposed off illicitly. Therefore, the applicant is legally entitled for remission of duty on short quantity noticed as a result of natural causes. Therefore, the impugned order denying the benefit of remission of duty under Rule 21 of Central Excise Rules is not justifiable in law and so deserves it to be quashed and set aside. 5.The applicant vide letter dated 12.06.2012 also requested for condonation of delay in filing Revision Application on following grounds: 5.1During the period November 2007 and May 2008, we cleared LAB from our premises for Export under Bond/LUT without payment of duty. After clearance of the goods from the factory the same is stored in storage tanks at port till vessel for export is available to us. The goods cleared from the factory ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e order of the Commissioner (Appeals) before the Hon'ble CESTAT on the ground that the Hon'ble CESTAT has admitted and took the decision in such types of cases in various decisions. Some of them are: (i) Associated Capsules Pvt. Ltd. reported in 2007 (207) ELT 613 (Tri. Mumbai) (ii) M/S Kuntal Granites Ltd. reported in 2007 (215) EL T 515 (Trib. Bang.) (iii) Sree Narasimha Textiles Ltd. reported in 2009 (239) EL T 86 (Trib. Chennai) and so on. In view of the above we filed the appeal before the Hon'ble Tribunal under the bonafide impression that such types of appeals could be heard by the Tribunals. In the present case the Hon'ble Tribunal has not taken the decision merely because the Departmental representative objected about the jurisdiction in the said appeal. Therefore, the appeal is not rejected on the grounds of limitation, but rejected on the grounds of jurisdiction. Therefore, we filed the revision application against the order of the Commissioner (Appeals) before your Honour immediately when decision pronounced in the open court on 8.5.12. Since initially we filed the appeal before the Hon'ble CESTAT within stipulated time ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd the cited decisions produced before them and rejected our claim merely on a flimsy ground that short shipment has taken place only in respect of consignment sent in the months of November 2007 and May 2008 and no proof has been given that NGL and LAB belongs to the same group. 6.1.4 The only issue to be decided in the present case is that whether the short quantity noticed in export goods due to natural causes, duty is required to be paid or otherwise. 6.1.5 It is submitted that the grounds stated in Revision Application are required to be considered. In addition to that we further state that it is not the case of the Department that non-export of short quantity is as a result of removal of goods illicitly there is no such allegation by the Department. It is undisputed fact that short quantity is due to natural causes. Since the short quantity is much below 0.17 which is within the permissible condonable limits and required to be condone and no duty could be demanded. In support of this in addition to the decisions cited in the grounds in revision application we have produced several decisions before your Honour during personal hearing. 6.1.6 From the copy of the Legal ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... D.Date of communication of Tribunal's Order dated 08.05.2012: 14.05.2012 E.Date of filing Revision Application . 25.05.2012 F.Time taken in filing Revision Application since the date of. 12 days Communication of Tribunal Order D E G.Total time taken for filing Revision Application after. 37+12= 49 excluding time lapsed during proceedings before CESTAT C+F days 8.2 Government notes that the Hon'ble High Court of Gujarat in case M/S Choice Laboratory vide order dated 15.09.2011, Hon'ble High Court of Delhi in case of M/S High Polymers Ltd. vide order dated 04.08.2011 and Hon'ble Bombay High Court in case of UOI (Revisionary Authority) vs M/S EPCOS India Pvt. 364 (Bom) in order dated 25.04.2012 have held that the period spent in prosecuting the proceedings bonafidely before the CESTAT, which had no jurisdiction, have to be excluded by giving the benefit of the provision of Section 14 of Limitation Act, 1963 while reckoning the time limit for filing revision application. 8.3 As such after excluding time elapse before Tribunal, the applicant filed the Revisional Application in 49 days. As such the Applica....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y natural causes or by unavoidable accident or are claimed by the manufacturer as unfit for consumption or for marketing, at any time before removal, he may remit the duty payable on such goods, subject to such conditions as may be imposed by hin7 by order in writing. On plain reading of the Rule 21, it is seen that remission is applicable if the goods have been lost or destroyed by natural causes or by unavoidable accident or are claimed by the manufacturer as unfit for consumption or for marketing, at any time before removal. Therefore, if any of the eventualities had occurred after the removal of goods, there are no governing provisions under Rule 21 of Central Excise Rules, 2002 empowering the Central Excise Officer to remit the duty payable on the goods destroyed by natural causes. Therefore, the applicant's contention that they were eligible for remission under Rule 21 of Central Excise Rules, 2002 is devoid of merit. 11.2 Government's above view finds support in the following judicial pronouncements: 11.2.1 In the case of S.V.G. Exports (P) Ltd. vs. Cc, Chennai-Ill 2008 (232) E.L.T. 305 (Tri. - Chennai), it was held that 4. I have carefully considered the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nly when this loss or destruction has taken place 'Vat any time before removal". Thus the point of time when the loss or destruction should take place is the time before the "time of removal". In my view the words "at any time before removal", cannot be read as "at any place before the place of removal"; they have to be read as "at any time before the time of removal". In terms of the provision of Section 4(3)(cc) of the Central Excise Act, 1944, the time of removal even in respect of the goods sold from the depot or from consignment agent's premises or from any other place, is the time when the goods are cleared from the factory. Therefore, in respect of the goods cleared for export, even if the "place of removal" is the port from where the goods are exported, the "time of removal" would be the time when the goods have been cleared from the factory and, therefore, if the goods are lost during transit, for the purpose of Rule 21, the "time of removal" would have to be treated as the time at which the goods were cleared from the factory. In the judgments of the Tribunal in the cases of Kuntal Granites Ltd vs CCE, Bangalore (supra) and CCE, Coimbatore vs Sree Narasimha Textil....