MS INDRA PROCESSORS Vs. CCE CHANDIGARH

JUDGEMENT

(1.) THE appellants are the processors of specified textile fabrics which are chargeable to duty in terms of Section 3A of the Central Excise Act, 1944 has amended. They are operating hot air stenters installed in their factory for the processing of such fabrics.

(2.) THE Commissioner of Central Excise Chandigarh -II vide his order dated 27.4.2000 has fixed their annual capacity of production at Rs.474.48 lacs for the period from 1.4.99 to 29.2.2000 under Rule 3(4) of Hot Air Stenter Independent Textile Processors Annual Capacity Determination Rules, 1998. The present appeal is against this order of the Commissioner. Shri K.K.Anand, Adv. for the appellants submits that the Commissioner has fixed the annual capacity of production for the stated period by including the length of galleries attached to their stenter. He submits that the Larger Bench of CEGAT in the case of Sangam Processors Vs 429(CEGAT) (LB) has held that the length of the galleries is not to be taken into account while computing the production capacity of stenter as it is not an equipment aiding the process of heat setting or drying of fabrics as contemplated by Explanation I to Rule 3 of Hot Air Stenter Independent Textile Processors Annual Capacity Determination Rules, 1998. Ld. Adv. for the appellants further submits that while fixing the aforesaid annual capacity of production by including the length of galleries, the Commissioner neither put them on notice nor has he given them an opportunity of hearing to explain their case. He accordingly requests that the matter may be remanded for re -determination of the capacity of production in terms of the aforesaid decision of the CEGAT. Shri K.Panchat Charam, JDR for the respondents has no objection for taking of such course of action.

(3.) I have carefully considered the submissions made before me. It is observed that the order of the Commissioner dt 27.4.2000 fixing the annual capacity of production of the appellants is non -speaking. No calculation is given in this order while arriving at the final figures. In view that the law relating to the inclusion of the length of galleries in computing the production capacity of a stenter now stands settled in terms of the cited decision of the Tribunal, the order of the Commissioner appealed against is set aside and the matter remanded to him for passing a fresh order by applying the ratio of the said decision.