Stenter chamber computation turns on deeming language; internal fabric-movement arrangement was not treated as chamber-multiplying equipment.

The notification for annual capacity of production under the stenter rules measures capacity by the number and size of chambers, and Explanation I deems a float drying machine or similar specified equipment attached to a stenter as one chamber. A fabric-movement arrangement installed inside the stenter, which only aided movement of fabric below the chain, did not fall within that deeming language and could not be treated as chamber-multiplying equipment. The additional drying effect was already captured within the prescribed capacity mechanism, so the chamber count could not be increased on that basis and the demand was unsustainable.

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Issues: Whether the additional fabric-movement arrangement created inside the stenter amounted to a float drying machine or other equipment attached to the stenter so as to increase the number of chambers for determining annual capacity of production under the notification and rules.

Analysis: The notification required annual capacity to be determined on the basis of the number and size of chambers, the declared stenters and the processed fabrics cleared in the preceding year. Its Explanation I deemed a float drying machine or any other equipment of specified length installed in or attached to a stenter for aiding heat setting or drying as one chamber. The arrangement in question only facilitated movement of fabric below the stenter chain. The rule structure also showed that multiple chains within a chamber were not to be treated as multiplying chambers, and any additional drying effect was already reflected in production quantity and annual capacity computation.

Conclusion: The arrangement did not attract the deeming provision for a float drying machine, and the chamber count could not be multiplied on that basis; the assessee succeeded.

Final Conclusion: The demand based on increased chamber computation was unsustainable, and the assessee was entitled to consequential relief.

Ratio Decidendi: A fabric-movement arrangement inside a stenter does not become a float drying machine or chamber-multiplying equipment unless it is specifically covered by the deeming language of the notification; additional drying effects are to be accounted for within the annual capacity mechanism already prescribed by the rules.

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