Annual production capacity of dual rolling mills must be aggregated where each mill has its own re-heating furnace.

A unit with two rolling mills and a separate re-heating furnace for each mill is to have its annual production capacity computed by aggregating the capacity of both rolling mills. The contention that the mills should be assessed on a lower capacity because they were not run simultaneously, including due to a common electric motor and flywheel, was rejected. The governing departmental clarification treated each mill with its furnace as part of the unit's total assessable capacity, and that approach was applied in re-determining capacity for the relevant period.

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Issues: Whether the annual capacity of production of a unit having two rolling mills and two re-heating furnaces was to be determined by taking the sum total of the capacity of both mills or some lesser capacity on the basis that the mills were not run simultaneously.

Analysis: The installation of two rolling mills and two re-heating furnaces was admitted before the adjudicating authority. The plea that the mills could not run simultaneously because of a common electric motor and flywheel was rejected. The Board's clarification governing capacity determination provided that where each rolling mill has a re-heating furnace, the capacity of the unit is the sum total of the capacity of each rolling mill. The Commissioner applied that clarification while re-determining the annual capacity for the disputed period, and no legal infirmity was shown in that approach.

Conclusion: The annual capacity of production was rightly determined on the basis of both rolling mills, and the challenge to the re-determination failed.

Ratio Decidendi: Where a unit has two rolling mills and a separate re-heating furnace for each mill, the assessable annual capacity is to be computed by aggregating the capacity of each rolling mill in the unit in accordance with the governing departmental clarification.

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