Maintenance of separate accounts for exempted inputs must be verified from the record before reversing factual findings.

A factual finding on maintenance of separate accounts for inputs used in exempted boilers cannot be overturned without proper verification of the record. The original authority had found that separate accounts were maintained and that credit was not taken for inputs used in the exempted product, but the appellate authority reversed that finding on a general observation and an isolated instance of credit that was later reversed. As the relevant records were not independently examined, the Tribunal set aside the order and remanded the matter to the Commissioner (Appeals) for fresh factual determination.

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Issues: Whether the finding that separate accounts were not maintained for inputs used in exempted boilers could be sustained without proper examination of the record.

Analysis: The original adjudicating authority had recorded a factual finding that separate accounts were maintained and that credit was not availed in respect of inputs used in the exempted product. The appellate authority reversed that finding on a general observation and relied mainly on a single instance of availed credit that was later reversed. The record supporting maintenance of separate accounts had not been independently verified at the appellate stage.

Conclusion: The impugned order was set aside and the matter was remanded to the Commissioner (Appeals) for fresh decision after proper factual verification.

Final Conclusion: The controversy was not finally decided on merits and was sent back for reconsideration in accordance with the Tribunal's observations.

Ratio Decidendi: A factual finding on maintenance of separate accounts cannot be reversed without proper verification of the relevant records, and reliance on an isolated instance is insufficient where the underlying factual position remains unexamined.

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