Duty demand and penalty set aside where key quantification and re-credit objections were left unanswered; matter remanded for fresh adjudication

Where material defences on the nature of re-credit permission, opening stock, and duty quantification are raised but not met with reasoned findings, the matter warrants de novo adjudication. The Tribunal noted that the adjudicating authority had not examined the appellant's contentions regarding the running bond re-credit, the stock position as on 01.07.2017, or the amount already paid and appropriated. For that reason, the order confirming duty demand, interest, appropriation, and penalty was set aside and the dispute was remanded for fresh consideration after affording opportunity to produce evidence and be heard.

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Issues: Whether the impugned order confirming duty demand, interest, appropriation and penalty should be set aside and the matter remanded for fresh consideration in view of the appellant's contentions regarding the nature of re-credit permission, opening stock, and duty quantification.

Analysis: The dispute arose from duty-free import of inputs under the concessional import rules and subsequent DTA clearances. The appellant contended that permission granted by the proper officer to take re-credit in the running bond amounted to an assessment-like decision and that the demand could not be sustained without challenging such decision. It was also urged that the adjudicating authority had not considered the plea regarding opening stock as on 01.07.2017 or the correct amount paid and appropriated. The Tribunal noted that these contentions had been raised before the adjudicating authority but were not dealt with by reasoned findings. In these circumstances, and in view of the need to examine the evidence and contentions afresh, the matter required de novo adjudication.

Conclusion: The impugned order was set aside and the matter was remanded to the adjudicating authority for fresh consideration after granting opportunity of hearing and evidence. The assessee succeeded in obtaining remand.

Final Conclusion: The adjudication did not attain finality on the merits of the duty demand or penalty, and the dispute was sent back for reconsideration on all open issues.

Ratio Decidendi: Where material contentions and quantification disputes raised in defence are not examined by the adjudicating authority, the appropriate course is remand for fresh decision after due opportunity of hearing.

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