Shrinkage allowance for processed fabrics cannot be fixed mechanically; factual scrutiny and departmental instructions must guide reassessment.

A mechanical 2% shrinkage allowance for processed man-made fabrics was not justified without examining lot-wise shortages, the nature of processing, and the material on record. Departmental instructions indicated that shrinkage in such fabrics could be higher and that the prescribed percentage was not absolute. Because the impugned order again applied the 2% norm without adequate factual scrutiny or proper consideration of those instructions, it was set aside and remanded to the adjudicating authority for fresh decision after personal hearing.

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Issues: Whether the assessment of shrinkage at 2% in respect of processed man-made fabrics was sustainable, and whether the matter required remand for fresh decision.

Analysis: The Tribunal noted that the earlier order in the same matter had found that a mechanical application of a uniform 2% shrinkage allowance was not justified without considering lot-wise shortages, the nature of processing, and the material placed before the authorities. The Tribunal also relied on departmental instructions indicating that shrinkage in man-made fabrics could be higher and that the prescribed percentage was not absolute. In the present case, the impugned order again applied 2% shrinkage without adequate examination of the relevant facts and instructions.

Conclusion: The order was set aside and the matter was remanded to the adjudicating authority for fresh consideration after taking the relevant instructions into account and giving the appellant an opportunity of personal hearing.

Final Conclusion: The dispute was sent back for reconsideration on merits, and the earlier percentage-based determination did not survive.

Ratio Decidendi: A percentage allowance for shrinkage cannot be applied mechanically and must be determined on the basis of the facts, the nature of processing, and the material on record.

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