Annual production capacity computation requires notice, hearing, and technical enquiry before treating galleries as part of stenters.

Annual production capacity could not be redetermined by treating galleries as part of the stenters without first giving the assessee notice, an opportunity of hearing, and a fair chance to place technical material. The dispute required technical examination on whether the galleries were merely protective devices or formed part of the drying chambers for capacity computation. The authority was required to associate the assessee with the enquiry, obtain expert opinion where necessary, and pass a reasoned order on the technical issue. The impugned order was set aside and the matter was remitted for fresh decision after technical enquiry and hearing.

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Issues: Whether the re-determination of annual production capacity by treating galleries as part of the stenters could be sustained without giving notice and an opportunity to the assessee, and whether the matter required remand for technical examination.

Analysis: The dispute turned on a technical question as to whether galleries formed part of the stenters for capacity computation. The assessee's contention that the galleries were only protective devices, and not part of the drying chambers, required technical examination. It was held that the Commissioner was bound to associate the assessee with the enquiry, obtain technical expert opinion, and permit the assessee to adduce technical material and evidence before passing a reasoned order.

Conclusion: The impugned order was set aside and the proceedings were remitted to the Commissioner for fresh decision after technical enquiry and hearing the assessee.

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