An incident occurred on a rig where 420 feet (128 meters) of tubing was dropped in the well because the shear rams were activated. The rig was tripping out of the hole at crew change time. Work was simultaneously being done in the cellar. The tubing was in the rotary table with a lifting cap attached. The personnel thought the tubing was clear of the rams, and closed them. The rams sheared the tubing, which fell to the bottom of the well. The tubing was fished out of the hole with a loss of two days rig time.