Annual capacity determination for re-rolling mills must follow the specific rule for changed parameters, not the general provision.

Where the manufacturing parameters of a hot re-rolling steel mill change, annual capacity must be fixed under the specific capacity-determination provision applicable to such change, namely Rule 4(2) of the Hot Re-rolling Steel Mills Annual Capacity Determination Rules, 1997 read with Notification No. 32/97. The capacity is to be worked out by applying the prescribed formula under Rule 3(3), rather than by resorting to the general provision in Rule 5. The note states that the capacity figures computed on that basis were upheld and the appeals succeeded with consequential relief.

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Issues: Whether annual capacity of production of the steel rolling mills was required to be determined under Rule 4(2) of the Hot Re-rolling Steel Mills Annual Capacity Determination Rules, 1997, instead of Rule 5, where there was a change in the parameters of the mills.

Analysis: The relevant clause for fixing annual capacity was Rule 4(2) of the Hot Re-rolling Steel Mills Annual Capacity Determination Rules, 1997 read with Notification No. 32/97 dated 1-8-1997. Since the units had undergone a change in parameters, the capacity was to be worked out by applying the formula under Rule 3(3) of the Rules, and not by resort to Rule 5.

Conclusion: The annual capacity of production had to be determined under Rule 4(2), and the capacity figures fixed on the basis of the formula under Rule 3(3) were upheld in favour of the appellants.

Final Conclusion: The capacity determination was modified to the extent that the correct statutory basis was held to be Rule 4(2), and the appeals succeeded with consequential relief.

Ratio Decidendi: Where the manufacturing parameters of a re-rolling mill change, annual capacity must be determined under the specific rule governing such change rather than the general provision.

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