Capacity determination under Rule 3 may rely on actual furnace parameters when no authenticated invoice showing original capacity is produced.

Rule 3 of the Induction Furnace Annual Capacity Rules, 1997 requires capacity to be determined first from an authenticated manufacturer's or trader's invoice; only if that material is unavailable may the Commissioner use comparable furnaces or other relevant evidence. Invoices relating merely to labour charges for modification of the furnace were not treated as authenticated invoices showing original capacity. On that basis, the Commissioner was entitled to rely on actual physical parameters of the furnace, measured in the presence of witnesses and the company's Director, together with supporting technical material, to fix annual production capacity. The capacity determination on actual parameters was therefore upheld.

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Issues: Whether the Annual Production Capacity of the induction furnace was required to be determined on the basis of the authenticated manufacturer's invoice under Rule 3 of the Induction Furnace Annual Capacity Rules, 1997, or whether the Commissioner could determine capacity on the basis of actual physical parameters and supporting technical material.

Analysis: Rule 3 prescribes a sequential method of determination. The authenticated manufacturer's invoice or trader's invoice is the primary basis; only if such material is unavailable may the Commissioner resort to comparable furnaces and, failing that, to any other relevant material. The invoices produced by the appellant were found to be invoices for labour charges relating to modification of the furnace, not authenticated invoices evidencing the original capacity. As such, they could not be treated as the documents contemplated by Rule 3(1). In these circumstances, the Commissioner was justified in relying on the actual parameters of the furnace as measured in the presence of witnesses and the company's Director.

Conclusion: The capacity determination based on actual parameters was upheld, and the appellant's challenge to the order fixing annual capacity failed.

Ratio Decidendi: Where the invoice produced is not an authenticated supplier's invoice showing furnace capacity, the Commissioner may proceed under the alternative modes prescribed by Rule 3 and determine capacity on the basis of reliable actual or technical material.

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