TaxTMI 
TaxTMI 
2023 (5) TMI 513
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....By the impugned order, Commissioner (Appeals) has upheld Order-in- Original No. 37/2008-09 dated 25.08.2008 holding as follows:- "Order 13 (i) I confirm the duty amounting to Rs.1,03,247/- (Rupees One Lakh Three thousand two hundred and forty seven only) under Section 11A of the Central Excise Act-1944 and order for its recovery from the assessee. (ii) I order the payment of appropriate interest under Section 11AB of the Central Excise Act-1944 on the above confirmed duty. (iii) I impose a penalty of Rs.1,03,247/- (Rupees One Lakh Three thousand two hundred and forty seven only) on the assessee under Rule 25 of Central Excise Rules-2002 read with Section 11AC of the Central Excise Act-1944." 2.1 Appell....
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....in appeal and during the course of arguments. 4.2 Commissioner (Appeals) in paras 4 & 5 of the order observed as follows:- "04. I have carefully gone through the case records and considered the averments made in the appeal, the case laws relied upon by them & the arguments advanced during personal hearing, and also relevant provisions of law related to the subject matter. The issue involved in the present appeal is whether the Central Excise duty on excisable goods which are destroyed in fire is payable or not. As per Rule 21 of Central Excise Rules, 2002, there is a provision for remission of duty on the goods destroyed by natural causes or by unavoidable accident at any time before removal. It revealed from the documents that ....
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.... duty against the goods destroyed under Rule 21 of Central Excise Rules, 2002 hence the demand of duty payment does not arise, is not acceptable by the department, as they have informed the department on 22.11.2007 that they have withdrawn the remission application, hence the claim of finished goods lost in the fire becomes invalid. As the goods are stored inside the factory, as per Rule 21 of Central Excise Rules, 2002 it still makes it mandatory to apply for remission of duty on the said finished goods destroyed due to natural causes. Under above circumstances, the quantity of goods claimed to have been lost in fire automatically becomes unaccounted and accordingly becomes chargeable to appropriate Central Excise duty along with interest.....
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....pplication for remission on his own. As regards second submission about the insurance claim, the demand is based on Para 20.14 of the surveyor report, wherein it has been observed as under : "20.14 As informed by the insured vide their letter dated 14-3- 07, their process for reversal of excise duty with excise department is under process. They have requested not to deduct the same. Considering this, we have not deducted applicable excise duty from the claim amount. The insurer is requested to allow the same on receipt of excise reversal documents from insured." 5. It is his submission from the above paragraph that the appellant would get reimbursement only if demand of duty is honoured and they have not received the same.....
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....mmissioner (Appeals) has set aside the demand of Rs. 1,27,655/- on finished goods since the same are removed from factory and directed the party to file remission application under Rule 21 of Central Excise Rules, 2002. The department has contested said order-in-appeal on the ground that original authority has no option but to confirm the demand in the absence of application for remission of duty and also contested the direction of Commissioner (Appeals) to party to file remission application at stage. In this regard, Government observes that duty is chargeable under Section 3 of Central Excise Act, 1944 but the payment of duty is deferred till removal of goods from the factory under Rule 8 of Central Excise Rules, 2002. This fact is not di....