2000 (3) TMI 98 - AT - Central Excise

Summary

Issues:
- Appeal against order-in-original regarding determination of annual production capacity under Hot Air Stenter Independent Textile Processors Rules, 1988.
- Inclusion of dimensions of galleries in the production capacity calculation.
- Interpretation of Notification No. 14/2000-C.E. (N.T.) regarding exclusion of galleries from the specified length of the machine.
- Nature of the Notification - clarificatory or superseding.

Analysis:
1. The appeal challenged the order-in-original fixing the annual production capacity under the Hot Air Stenter Independent Textile Processors Rules, 1988. The Commissioner included the dimensions of galleries in the calculation, resulting in a duty adjudged at Rs. 5,00,000/- per month and a confirmed demand of Rs. 2,78,788/- for a specific period.

2. The appellant's argument, presented by the learned Consultant, emphasized that galleries should not be considered part of the Stenters' dimensions as they serve for insulation, not heating the fabric. Additionally, reference was made to Notification No. 14/2000-C.E. (N.T.) which clarified the exclusion of galleries from the machine's specified length, asserting the retrospective effect of this explanation.

3. The opposing view, presented by the learned DR, maintained that the order-in-original was detailed and justified the inclusion of galleries' dimensions. The DR argued that the mentioned Notification introduced a new rule superseding the earlier ones, implying no error in the impugned order.

4. The Tribunal analyzed the submissions and records, concluding that galleries, with distinct functions from hot air chambers, should not be part of the Stenter's dimension. The Tribunal noted the necessity for the new rule with the clarification regarding galleries' exclusion, indicating the Government's realization of the issue. Critically, the Tribunal found the order-in-original lacking a detailed examination of the structural and functional differences between hot air chambers and galleries, deeming it not a speaking order.

5. Consequently, the Tribunal set aside the order-in-original, remanding the matter to the Commissioner for a fresh consideration after hearing the appellants' submissions. The Commissioner was directed to thoroughly assess the structural and functional disparities between galleries and hot air chamber stenter machines. The appeal was allowed for remand, with a waiver of pre-deposit and a stay on recovery of the amount in question.