Cenvat credit on fuel used for exempted goods requires reasoned adjudication; cryptic orders may be set aside and remitted.

The Tribunal's cryptic order on availment of Cenvat credit on fuel used in manufacturing exempted goods could not be sustained because it did not show whether the correct Supreme Court authority had been applied or whether the competing legal positions were properly examined. In the absence of clear reasoning, the controversy could not be finally resolved on the material then before the court. The Tribunal's order was therefore set aside and the matter remitted for fresh adjudication on merits and in accordance with law.

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Issues: Whether the Tribunal's unreasoned and cryptic order on availment of Cenvat credit on fuel used in the manufacture of exempted goods could be sustained, or whether the matter required reconsideration.

Analysis: The Tribunal's order did not disclose whether it had applied the correct Supreme Court authority on the issue of credit on fuel used in manufacturing exempted and dutiable products. As the order gave no clear reasoning and did not show a proper determination of the competing legal positions, the controversy could not be finally resolved at this stage. In those circumstances, the proper course was to set aside the Tribunal's order and remit the matter for a fresh decision on merits and in accordance with law.

Conclusion: The Tribunal's order was set aside and the appeal was remitted for fresh adjudication.

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