Production capacity redetermination required where later Supreme Court law changed the chamber-counting method for a hot air stenter.

Annual production capacity fixed under an earlier order had to be reconsidered because that order itself permitted redetermination if relevant parameters changed, and the later Supreme Court ruling excluded galleries without fan or radiator attachment from the chamber count in a hot air stenter. The earlier capacity figure could not remain conclusive without applying that binding principle to the unit's facts. As the adjudicating authority had not given a reasoned decision on the assessee's request for reconsideration, the matter was remitted for fresh determination in accordance with natural justice.

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Issues: Whether the annual capacity of production determined under the order dated 1 July 1999 required redetermination in light of the Supreme Court ruling excluding gallery length from the count of chambers, and whether the matter should be remanded for fresh determination.

Analysis: The order determining capacity had been made subject to redetermination if relevant parameters changed. The subsequent Supreme Court ruling held that galleries without fan or radiator attachment cannot be counted while determining the number of chambers in a hot air stenter. In that situation, the earlier capacity determination could not be treated as finally conclusive against the assessee without considering the effect of the later binding law. The adjudicating authority had not applied the Supreme Court principle to the facts of the unit, and the assessee's request for reconsideration had not been addressed by a reasoned decision following fair procedure.

Conclusion: The capacity determination was required to be redetermined, and the matter was remitted to the adjudicating authority for fresh decision after following principles of natural justice. The assessee obtained partial relief.

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