Credit-related relief and remand for fresh adjudication where the appellate order lacked independent application of mind.

An appellate order denying credit-related relief was found unsustainable because it rested on incorrect assumptions about the inputs and final products and reflected a mechanical adoption of an earlier decision without independent application of mind. The order was therefore set aside, and the matter was remanded for fresh adjudication on merits. The appellate authority was directed to afford the assessee a reasonable opportunity of hearing before deciding the matter anew.

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Issues: Whether the impugned order denying credit-related relief was sustainable when it suffered from non-application of mind, and whether the matter should be remanded for fresh adjudication.

Analysis: The findings in the impugned order were based on incorrect assumptions about the nature of the inputs and the final products, and the reasoning appeared to have been mechanically followed from an earlier order without independent application of mind. In these circumstances, the appellate order could not be sustained. The proper course was to set aside the order and direct a fresh decision after granting a reasonable opportunity of hearing to the assessee.

Conclusion: The impugned order was set aside and the matter was remanded to the Commissioner (Appeals) for fresh decision on merits after hearing the assessee.

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