GEPACH INTERNATIONAL Vs. COMMISSIONER OF CENTRAL EXCISE, BANGALORE

JUDGEMENT

(1.) THIS appeal is filed by M/s. Gepach International, against the letter No. 401/2003, dated 18 -7 -2003, issued by the Superintendent of Central Excise, Peenya Range, Seshadripuram, Bangalore, to M/s. Karnataka Antibiotics & Pharmaceuticals Ltd., intimating that their application dated 24 -2 -2001, seeking permission for destruction of time expired excisable goods cleared for export but returned to the factory without being exported was forwarded to the Commissioner of Central Excise who in turn informed that in the instant case, duty cannot be remitted in terms of Rule 21 of the Central Excise Rules, 2002. He, therefore, requested M/s. Karnataka Antibiotics & Pharmaceuticals Ltd. to pay duty.

(2.) SHRI Chidananda Urs, learned Advocate appearing for the appellants submitted that the main decision has been communicated by the Superintendent is not maintainable under the law as it is without jurisdiction. He relied upon the Tribunal decision in case of Rosa Sugar Works v. CCE reported in 2001 (132) E.L.T. 323 (T -NZB) wherein it was held that under Rule 49, an application for remission of duty has to be disposed of by the Commissioner himself and that too by an order in writing. The order for rejection of remission of duty and destruction of goods has been passed without making any findings. Application for destruction of excisable goods and remission of duty was filed with the office of Deputy Commissioner of Central Excise under Rule 49(1A). Rule 49(1A) makes it clear that the manufacturer has the right to apply for remission of duty on goods which have become unfit for consumption or for marketing. There is no condition that as to whether goods have become unfit for consumption or marketing before the removal of goods as it is expressly provided under new Rule 21 of the Central Excise (No. 2) Rules, 2002. The impugned letter communicating rejection of the application for destruction of goods under Rule 21 is bad in law. He relied upon the following decisions in support of his claim - (i) Triveni Engg. & Ind. Ltd. - 2002 (146) E.L.T. 580 (Tri. Del.) wherein held that Remission application of appellant under Rule 49 of erstwhile Central Excise Rules, 1944 would have the consequence of obligating the assessee to pay duty, such a decision would be quasi judicial. The Commissioner exercising a quasi judicial function under Rule 49 is bound to follow the principles of natural justice and pass a speaking order. (ii) ITC Ltd. v. CCE, Calcutta - 2001 (130) E.L.T. 223 (Tri. -Kolkata) wherein it was held that Remission of Duty/Destruction of goods under Rule 49 of Central Excise Rules are quasi judicial functions and hence an order refusing to consider such request without indicating any reasons not sustainable and set aside. (iii) Oudh Sugar Mills Ltd. v. CCE, Lucknow - 2001 (133) E.L.T. 335 (Tri. Del.) wherein it was held that in proviso to Rule 49(1) of Central Excise Rules, 1944, show cause notice followed by a personal hearing is must before a decision is taken by the Commissioner on the question whether any quantity of molasses has been lost or destroyed in the process of handling or storage in any approved tank.

(3.) SHRI M.K. Madhyastha, learned JDR appearing for the Revenue stated that the appeal has been filed against the letter of the Superintendent wherein he has intimated M/s. Karnataka Antibiotics and Pharmaceuticals Ltd. that the Commissioner has informed that the duty cannot be remitted and he accordingly asked the appellants to pay duty of Rs 1,49,687/ -. He stated that the appeal of the appellants is not maintainable. The communication is a letter from Superintendent to M/s. Karnataka Antibiotics and Pharmaceuticals Ltd wherein he asked them to deposit the duty. It is not a communication to the appellants.