Remission application must be decided by speaking order before duty demand for storage shortage can be confirmed.

Duty demand for molasses found short in storage cannot be sustained unless the assessee's remission application is first decided by the competent authority through a speaking order after hearing the assessee. An internal communication or mere intimation of rejection is not a lawful substitute for a reasoned decision. Because the remission claim was pending and had not been determined in accordance with law, the demand based on the alleged shortage could not validly be confirmed. The matter required reconsideration by the Commissioner, with a proper hearing and a fresh determination of duty liability.

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Issues: Whether the duty demand on molasses found short in storage could be confirmed without first deciding the assessee's remission application after hearing the assessee.

Analysis: The remission application had been made before issuance of the show cause notice and was required to be decided by the competent authority by a speaking order after hearing the assessee. A mere internal communication or intimation of rejection was not a lawful substitute for a reasoned order. Until the remission claim was determined in accordance with law, the duty demand for the alleged shortage in storage could not validly be sustained.

Conclusion: The duty demand could not be confirmed in the absence of a proper decision on remission. The matter was required to be reconsidered by the Commissioner after hearing the assessee, followed by a fresh decision on duty liability.

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