Merits-based adjudication required for interest claim on delayed abatement; matter remanded for fresh decision after hearing the assessee.

A claim for interest arising from delayed sanction of abatement under Rule 96ZQ could not be rejected through a mere communication without a merits-based adjudication. The competent authority was required to decide the claim substantively after hearing the assessee; because the interest claim had not been examined on merits, the appellate order could not stand. The impugned order was set aside and the matter was remanded to the Commissioner for fresh decision on merits.

---

---

Issues: Whether the claim for interest arising out of delayed sanction of abatement under Rule 96ZQ could be rejected without a decision on merits and whether the matter required fresh consideration by the proper authority.

Analysis: The assessee had initially approached an authority which stated that it was not competent to sanction claims under Rule 96ZQ of the erstwhile Central Excise Rules, 1944. The assessee then pursued the claim before the proper authority, but the claim for interest was not examined on merits. The proper course was for the competent authority to adjudicate the claim substantively, rather than drive the assessee into appellate proceedings against a mere communication. Since the merits of the claim had not been decided, the appellate order could not stand.

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

---