Central Excise - Excisability of Plant & Machinery assembled at site - Communication of Board's Order No. 53/2/98-CX., dated 2-4-98 under Section 37B of C.E. Act, 1944 - Regarding - Central Excise - Order No. 53/2/98-CX.

Order No. 53/2/98-CX. Dated 2-4-1998 [From F. No. 154/04/98-CX. 4] Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Central Excise - Excisability of Plant Machinery assembled at site - Communication of Board's Order No. 53/2/98-CX., dated 2-4-98 under Section 37B of C.E. Act, 1944 - Regarding. Attention is invited to the instructions issued by the Central Board of Excise and Customs (henceforth referred to as the Board) from time to time regarding the excisability of plant and machinery assembled at site. 2. Recently the Hon'ble Supreme Court in its order dated 11-12-97 in the case of Sirpur Paper Mills Ltd v. CCE, Hyderabad, [1998 (97) E.L.T. 3 (S.C.)], with regard to the paper making machine assembled and erected at site has held that it is not an immovable property as something attached to earth like a building or a tree. Just because the plant and machinery are fixed in the earth for better functioning, it does not automatically become an immovable property. The paper making machine is marketable as it can be dismantled and sold. 3. The matter has been examined by the Board in the light of Hon'ble Supreme Court's decision dated 11-12-97 mentioned above. This being the latest judgment on the subject, Board is of the view that the ratio of this judgment should be followed scrupulously in deciding the excisability of plants and machinery assembled and erected at site. 4. Now, therefore, in exercise of the powers conferred under Section 37B of the Central Excise Act, 1944 (henceforth referred to as the Act) and for the purpose of ensuring uniformity in the levy of duty of excise, the Board hereby orders that plant and machinery which is assembled and erected at site would attract central excise duty as leviable on excisable goods. The broad criteria to be satisfied are : (i) The final product is distinct and apart from the components that have gone into its production. (ii) It is specified in the Central Excise Tariff as 'excisable goods'. (iii) It is 'goods' and to merit to be called 'goods', it must be movable and saleable. Whatever is embedded in earth, unless it is like a building or tree or similar things, must not be necessarily treated as immovable property, if the whole purpose behind attaching to a concrete base is to secure maximum operational efficiency and safety. (iv) It can be sold in the market. It would be treated as marketable even though it may have to be removed from its base and dismantled, before being sold. 5. The Board further directs that copy of this order be sent to all Chief Commissioners and Commissioners of Central Excise for being observed and for being made available as required to all other persons employed in the execution of the Act and for issue of trade notices. 6. Wherever there is a conflict between this order and the instructions issued on the subject by the Board heretobefore, this order would prevail.