Duty demand must be quantified by the adjudicating authority; incorrect valuation data required fresh determination on remand.

An adjudicating authority must itself quantify the duty demand; it cannot leave computation to a lower authority, so an order that directed payment of differential duty without stating the amount was unsustainable. Valuation also had to be redone where the cost of production was based on incorrect input data, including a misapplied figure treated as profit rather than the cost of raw materials. The impugned orders were set aside and the matter remanded for fresh adjudication after proper quantification and recalculation on correct facts, with an opportunity of hearing to the assessee.

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Issues: (i) whether the order-in-original was sustainable when the duty demand was not quantified by the adjudicating authority and the computation was left to a lower authority; (ii) whether the valuation of soap stock required fresh determination because the cost of production was worked out on the basis of incorrect input data.

Issue (i): whether the order-in-original was sustainable when the duty demand was not quantified by the adjudicating authority and the computation was left to a lower authority.

Analysis: The adjudicating authority had directed the value of soap stock to be taken at Rs. 4,237 per metric ton and further stated that the differential duty should be worked out and paid forthwith, without itself indicating the amount of duty involved. Such computation of duty demand could not be delegated to a lower authority.

Conclusion: The order-in-original was unsustainable on this ground and was liable to be set aside.

Issue (ii): whether the valuation of soap stock required fresh determination because the cost of production was worked out on the basis of incorrect input data.

Analysis: The materials showed that the value of the principal raw materials had been wrongly taken from the appellant's price data for acid oil, where the figure represented margin of profit and not the cost of natural oil and gums. The valuation therefore required recalculation on correct data.

Conclusion: The valuation had to be reconsidered afresh by the original authority after working out the correct cost of production.

Final Conclusion: The impugned appellate and original orders were set aside and the matter was remanded to the Assistant Commissioner for fresh adjudication after giving the appellant an opportunity of hearing.

Ratio Decidendi: An adjudicating authority must itself determine and quantify the duty demand, and where valuation is based on demonstrably incorrect input data, the matter must be remitted for fresh determination on correct facts.

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