Per V.K. Ashtana :

Inthis case the appeal and the stay petition themselves are taken up together for consideration as the matter lies in a short compass. The appeal is against the order in original No. 5O/Ch. 54/99. Cxdated27.10.99 passed by the Commissioner of Central Excise, wherein while fixing the annual capacity of production under Rule 3 of the Hot Air Stenter Independent Textile Processors Annual Capacity Determination Rules, 1998, the dimension of the Galleries of both the stenter machines have also been included and accordingly duty of Rs. 5,00,000 per month has been adjudged under the said scheme and accordingly demand has been confirmed for Rs. 2,78,788/- for the period from 16.12.98 to 30.6.99.

2. Heard Shri B. Radhakrishnan, learned Consultant for the appellants and Shri S. Kannan, learned DR.

3. The learned Consultant submits that dimensions of the galleries are not required to be added to the dimension of Stenters for the reason that galleries are basically for insulation of heat and not provided for radiator nozzles to heat the fabric and therefore different instruments as well as role and function from the standard chambers. His second submission is that in view of the confusion whether or not to include the dimension of the galleries, the Govt. of India in the Budget for the year 2000-2001 framed rules vide Notification No. 14/2000 (CE)NT dated 1.3.2000 and by the explanation thereof it has been clarified that the galleries are to be excluded from the specified length of the metre shown in the machine from any such equipment as the galleries are not to be treated as part of Float Drying machine and hence not part of the chamber. The said clear explanation was not in the previous rules of 1998. Since this exclusion is in the form of explanation, therefore, the Notification is explanatory in nature, and should be given retrospective effect.

4. The learned DR on the other had submits that the order in original is a speaking order and details out how and why the dimensions have been included. He reiterates the same. He further submits that the Notification cited by the learned Consultant is not clarificatory in nature because it introduces only the said rule which supersede the earlier rules in the matter. Therefore, he submits that there is no error in the order in original impugned.

5. We have considered the submissions and records of the case. On consideration of the submissions we are of the considered opinion that in view of the fact that the structure as well as the functions of the galleries is totally different from those of the hot air chamber, particularly in view of the fact that there is no provision for blowing the hot air to heat the fabric when it is passed from the galleries, therefore, the same cannot be included in the dimension of the hot air chamber of the Stenter. In this connection we find that this has been incorporated in the new rule on the matter vide Notification cited by the learned Consultant. Obviously the Govt. of India felt the need for introducing such explanation in the rule in view of the dimension as contained in the order impugned. As against this, a perusal of the order impugned shows that the different structure and role for Hot air chambers and galleries has not been examined and discussed by the Commissioner in the said order. To this extent, it appears that the order is not a speaking order.

5. In view of the aforesaid analysis and findings, the order in original is set aside and the matter remanded to the Commissioner for de novo consideration of the entire issue after hearing the submissions of the appellants. The learned Commissioner shall also examine the issue of the structure and role of the galleries vis-a-vis that of the hot air chamber stenter machine. The appeal is allowed by way of remand after granting waiver of pre-deposit of the amount and stay of recovery of the same in the matter.