ROSA SUGAR WORKS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THIS appeal is against the Order -in -Appeal dated 24 -8 -1998 passed by the Commissioner (Appeals), Central Excise, Allahabad by which a duty demand of Rs. 30,096.90 was confirmed against the appellants and a penalty of Rs. 1,000/ - imposed.

(2.) BRIEF facts are : The appellants had stored non -duty paid Molasses weighing 11,147.00 qtls. in their open Kutchha Pit No. 1 without the approval of the Department. According to the Department, the said Kutchha Pit No. 1 was not approved by the Central Excise Department for storage of molasses since such Kutchha Pits were not safe. The said quantity of molasses stored in Kutchha Pit No. 1, according to the appellants, got destroyed by spontaneous combustion on 29 -6 -1996. The Department issued a Show Cause Notice alleging that the appellants had contravened the provisions of Rules 47, 48 and 173G of the Central Excise Rules as also the provisions of Trade Notice No. 259/88, dated 2 -1 -1989 of the Kanpur Commissionerate as the appellants had stored the said quantity of molasses without payment of Central Excise duty. The matter was adjudicated by the Asstt. Commissioner who confirmed the duty demand and imposed penalty. In Appeal the Commissioner (Appeals) upheld the duty demand but reduced the penalty from the equivalent amount of duty demanded to Rs. 1,000/ -.

(3.) LD . Counsel for the appellants, Shri Bipin Garg argues that the appellants had submitted to the jurisdictional Superintendent in 1994 plans of Kutchha Pits within their factory premises for storage of molasses and this Plan had been approved on 17 -3 -1994. The molasses which had become excess during 1995 -96 season was thereafter stored by the appellants in one of the said Kutchha Pits. They had also intimated this to the jurisdictional Superintendent with a copy to the Inspector. In the said letter, appellants had intimated to the authorities that due to excessive heat 11,147 qtls. molasses of 1995 -96 season stored in open Kutchha Pit No. 1, the temperature had gone up resulting in auto combustion and the molasses had started to burn. Though they had attempted to prevent damage and had sprinkled anti -foaming agents, ultimately the molasses became inflammable. He also refers to letter dated 9 -7 -1996 addressed by the appellants to the Commissioner, Central Excise, Kanpur stating that since 11,147 qtls. of molasses stored in Kutchha Pit No. 1 had been lost duty amount of Rs. 30,096.90 deserves to be remitted as per the Central Excise Act and Rules as the said molasses had got destroyed by accidental, spontaneous combustion. He also refers to the subsequent letter written by the appellants to the Commissioner dated 10 -1 -1997 enclosing details of remission demand in the prescribed proforma.