Order Date – 15 June 2023

Parties: Sun Pharmaceuticals Industries Ltd Vs C.C.E. & S.T.-Vapi

Facts – 

• The Appellant, Sun Pharmaceuticals Industries Ltd, are engaged in the manufacture of medical equipments, they have filed their application dated 26.08.2010 for remission of duty on the finished goods destroyed in fire accident occurred in their factory on 07.06.2010.
• The adjudicating authority found that the appellant have not taken proper precaution to avoid the fire accident. They have also not filed F.I.R. with police within 24 hours and concluded that the appellant have not fulfilled the conditions laid down in the Commissionerates Trade Notice No.36/2005 dated 15.04.2005

Issue – 

• Whether rejection of remission duty is in order?

Order –

• The Tribunal observed that in the panchnama, there is no whisper about any mischief done by the appellant for the fire accident took place in the factory of the appellant therefore, nothing is on record that the fire accident has taken place not accidental but intentional by the act of the appellant. In this position, without any evidence the allegation of the lower authorities that the appellant have not taken precaution has no basis.
• The appellant has granted insurance from the insurance company. Therefore, once insurance company has granted the insurance claim for the principal amount of the goods destroyed which is much more than the duty implication in the goods destroyed. It can be conveniently inferred that the insurance company has scrutinized minutely each and every aspect of the accident of fire taken place and only thereafter the insurance claim was granted.
• Hence it was held that appellant have made out a fit case for remission of duty which could not have been rejected by the lower authorities.