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TMI BlogExcisability of plant and machinery assembled at site - regardingX X X X Extracts X X X X X X X X Extracts X X X X ..... ited to Section 37B Order No. 53/2/98-CX, dt. 2-4-98 (F. No. 154/4/98-CX. 4) [1998 (100) E.L.T. T9] regarding the excisability of plant and machinery assembled at site. 3. A number of Apex Court judgments have been delivered on this issue in the recent past. Some of the important ones are mentioned below : (i) Quality Steel Tubes Pvt. Ltd. v. CCE [1995 (75) E.L.T. 17 (S.C.)] (ii) Mittal Engineering Works Pvt. Ltd. v. CCE, Meerut [1996 (88) E.L.T. 622 (S.C.)] (iii) Sirpur Paper Mills Limited v. CCE, Hyderabad [1998 (97) E.L.T. 3 (S.C.)] (iv) Silica Metallurgical Ltd. v. CCE, Cochin [1999 (106) E.L.T. 439 (Tribunal)] as confirmed by the Supreme Court vide their order dated 22-2-99 [1999 (108) E.L.T. A58 (S.C.)] (v) Duncan In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /machines, as a whole, may or may not be 'goods'. For example, plants for transportation of material (such as handling plants) are actually a system or a net-work of machines. The system comes into being upon assembly of its component. In such a situation there is no manufacture of "goods" as it is only a case of assembly of manufactured goods into a system. This cannot be compared to a fabrication where a group of machines themselves may be combined to constitute a new machine which has its own identity/marketability and is dutiable (e.g. a paper making machine assembled at site and fixed to the earth only for the purpose of ensuring vibration free movement) (v) If items assembled or erected at site and attached by foundation to earth ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e considered as immovable and therefore not excisable to duty. (vii) When the final product is considered as immovable and hence not excisable goods, the same product in CKD or unassembled form will also not be dutiable as a whole by applying Rule 2(a) of the Rules of Interpretation of the Central Excise Tariff. However, components, inputs and parts which are specified excisable products will remain dutiable as such identifiable goods at the time of their clearance from the factory or warehouse. (viii) The intention of the party is also a factor to be taken into consideration to ascertain whether the embedment of a machinery in the earth was to be temporary or permanent. This, in case of doubt, may help determine whether the goods are m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come into existence only by assembly and connection of various components and parts. Though each component is dutiable, the refrigeration/air conditioning system as a whole cannot be considered to be excisable goods. Air conditioning units, however, would continue to remain dutiable as per the Central Excise Tariff. (iv) Lifts and escalators. (a) Though lifts and escalators are specifically mentioned in sub heading 8428.10, those which are installed in buildings and permanently fitted into the civil structure, cannot be considered to be excisable goods. Such lifts and escalators have also been held to be non-excisable by the Govt. of India in the case of Otis Elevators India Co. Ltd. reported in 1981 (8) E.L.T. 720 (GOI). Further, this as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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