JUDGMENT
Srinivasan, J.
1. An interesting question arises in this case under the Central Excise Rules.
2. The facts leading to the present appeal are briefly as follows :
The appellant is a Tea Estate. On 26-1-1996 the Central Excise authorities inspected the appellant-estate and found shortage of 18,987.05 Kilo grams of tea. At that time the appellant had a stock of 6080.5 Kilo grams of tea. The explanation offered by the appellant was that the quantity found to be shortage had been stolen from the warehouse and the matter was being investigated. The authority issued show cause notice on 17-2-1969 as to why penalty should not be imposed, the remaining stock of tea should not be confiscated along with land, buildings, machinery etc. and a duty should not be imposed on the missing goods. In the proceedings the first authority namely, the Collector, passed an order imposing a penalty of Rs. 5,000/- confiscating the property and assessing the duty on the goods. On appeal, the Central Board of Excise and Customs reduced the penalty of Rs. 5000/- to Rs. 1000/-. In other respects the order of the Collector was confirmed. On a revision to the Government, the order of penalty was set aside and in other respects, the order of the authority below was confirmed.
3. Aggrieved appellant filed the writ petition. The learned Judge held that the order of confiscation of land, machinery, plant etc. was not valid and a fine of Rs. 500/- could be imposed. Levy of shortage duty on the missing goods is confirmed in the writ petition. It is that judgment which is challenged in this appeal.
4. It is contended by learned Counsel for the appellant that the appellant is entitled to remission under Rule 147 of the Central Excise Rules, 1944, and the authorities have not considered the question of remission. Rule 147 reads as follows :-
“Power to remit duty on warehoused goods lost or destroyed. If any goods lodged in a warehouse are lost or destroyed by unavoidable accident, the Collector may in his discretion remit the duty due thereon :
Provided that if any goods be so lost or destroyed in a private warehouse, notice thereof shall be given to the officer-in-charge of the warehouse within 48 hours after the discovery of such loss or destruction.”
5. The argument of learned Counsel for the appellant is that in this case the missing goods were stolen and later in a criminal proceedings the Manager and two Assistants were convicted as they were found guilty, It is, therefore, argued that loss of goods by theft would fall within the scope of the Rule as it would amount to “unavoidable accident”. In support of his contention learned Counsel places reliance on the judgment of the Calcutta High Court in Bavaji and Moti Bai v. Inspector of Central Excise and Others reported in 1979 (4) E.L.T. (J 282). A learned Single Judge of that Court held that loss by theft would fall within the scope of the Rule. The relevant part of the judgment reads as follows :-
“Under Rule 147 of the said rules, the Collector has power to remit duty on warehoused goods lost or destroyed by unavoidable accident. The word accident has been appropriately held by the Board, in their determination dated 28th November, 1972 in Annexure ‘F’, to include “theft” and further more in my view the word “lost” as mentioned in the said Rule would also include “theft” and as such the application as filed by the said firm, was competent and the same was required to be determined by the proper officer, as the same was also filed within time. It is true that this Rule 147 speaks of remission of duty by the use and exercise of discretionary power by the Collector and is silent about any enquiry. But such enquiry may be presumed, as when the Collector is required to exercise his discretion, he is also expected to act on some materials for the purpose of forming the opinion as to whether such discretion as mentioned in the Rule should be exercise or not”.
6. Our attention is also drawn to the decision of High Court of Delhi in Sialkot Industrial Corporation, Meerut v. Union of India and Another – 1979 (4) E.L.T. J 329. That was a case under Section 23 of the Customs Act. In Section 23 of the Customs Act, the relevant words are “lost or destroyed” at any time before clearance for home consumption. The words “unavoidable accident” are not found in the said Section. That Court held that the language of the Section postulates loss or destruction caused by whatsoever reason, whether theft, fire, accident including pilferage. The language of Section 23 is much wider than that of Rule 147. In our opinion the absence of the word ‘unavoidable accident’ would make all the difference.
7. In Caltex Oil Refining (India) Limited v. Union of India and Others reported in 1979 (4) E.L.T. (J 581) the question related to lose by natural causes. Learned Counsel for the appellant referred to the decision of a Tribunal in Yashwant S.S.K. Limited v. Collector – 1990 (49) E.L.T. 534 (Tribunal). In that case there was no consideration of the provision to Rule 147 of the Central Excise Rules, 1944. Tribunal had no occasion to discuss the question whether loss by theft would amount to loss by unavoidable accident.
8. Only ruling which supports the contention of the appellant is that of the Calcutta High Court referred to above. With due respect we are unable to agree with the reasoning found in the judgment of the Calcutta High Court. In our opinion the word unavoidable accident is of crucial importance. Theft cannot be said to be an accident by any stretch of imagination. When a person deliberately removes the goods for his own purposes without the knowledge of the owner thereof, it cannot be said to be ‘an accident’. [Nor] is it unavoidable as the owner should have taken proper steps and care to protect his goods and make them immune from the theft. Hence, Rule 147 of the Central Excise Rules, 1944 does not contemplate loss of [goods by theft]. We find in Rule 225 there is a provision that if any excisable goods are removed by any person from the place where they are produced, manufactured or warehoused, the producer or manufacturer or the licensee or keeper of the warehouse shall be held responsible for such removal and shall be liable to be dealt with according to the provisions of the Act or the Rules as if he had removed the goods himself. That Rule will certainly apply in the case of theft where the owner has not taken care to protect the goods in the appropriate manner so as to prevent any theft or pilferage.
9. In the result, we are in agreement with the conclusion by the authorities that the appellant is not entitled to claim any remission and that Rule 147 has no application in the present case. Consequently, the appeal fails and is dismissed. There will be no order as to costs.