Site assembly of turbo generating sets failed the marketability test, so the installation was not excisable goods.

Assembly and erection of turbo generating sets and a steam generating set at the project site did not amount to manufacture of marketable excisable goods. The unit was fixed on a concrete foundation through alignment, coupling and grouting, but it remained an installation completed in situ and was not movable property capable of being treated as excisable goods. The arrangement was treated as materially similar to the turbo alternator considered in Triveni Engineering, where dismantling would reduce the unit to its components and the test of permanency and marketability was not met. On that basis, the duty demand and penalties were not sustainable.

---

---

Issues: Whether the assembly and erection of turbo generating sets and a steam generating set at the project site amounted to manufacture of marketable excisable goods.

Analysis: The process involved fixing the turbines and alternators on a concrete foundation, alignment, coupling, grouting and completion of the unit at site. The arrangement was found to be identical in substance to the turbo alternator considered by the Supreme Court in Triveni Engineering, where it was held that the assembled unit, on removal, would be dismantled into its components and would not satisfy the test of permanency or marketability. The platform and concrete base specially constructed at the land could not be treated as a common base for classification under Heading 85.02, and the resulting installation was not movable property capable of being treated as excisable goods.

Conclusion: The assembly of the turbo and alternator did not satisfy the test of marketability or excisability, and the duty demand and penalties were liable to be set aside.

---