Statutory re-determination of production capacity cannot be overridden by a Rule 96ZO declaration or ignored remand directions.

A statutory right to re-determination of annual capacity of production on the basis of actual production under Section 3A(4) of the Central Excise Act, 1944 cannot be defeated by a declaration filed under Rule 96ZO of the Central Excise Rules, 1944. The adjudicating authority was required to comply with the Tribunal's earlier remand directions and could not reject the claim merely because the Rule 96ZO(3) declaration had not been withdrawn. The impugned order was therefore unsustainable, and the matter had to be reconsidered in accordance with the prior remand.

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Issues: Whether the Annual Capacity of Production was required to be re-determined on the basis of actual production under Section 3A(4) of the Central Excise Act, 1944 notwithstanding the declaration filed under Rule 96ZO of the Central Excise Rules, 1944, and whether the adjudicating authority was bound by the Tribunal's earlier remand directions.

Analysis: The Tribunal had earlier directed the adjudicating authority to examine the assessee's claim for re-determination of ACP on actual production basis under Section 3A(4), and that direction had not been modified. The Revenue's challenge had also failed. The Court held that a right conferred by the statute under Section 3A(4) could not be defeated by a declaration filed under the Rule, and that the adjudicating authority was bound to comply with the Tribunal's remand orders. The rejection of the claim merely because the declaration under Rule 96ZO(3) had not been withdrawn was therefore unsustainable.

Conclusion: The impugned order was not sustainable, and the matter had to be reconsidered by the adjudicating authority in accordance with the Tribunal's earlier directions.

Ratio Decidendi: A statutory entitlement to re-determination under Section 3A(4) of the Central Excise Act, 1944 cannot be taken away by a declaration under Rule 96ZO of the Central Excise Rules, 1944, and an authority is bound to follow the Tribunal's remand directions.

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