Embedded plant and machinery as immovable property can be included in stamp duty valuation when transferred with a going concern.

Embedded plant and machinery are treated as immovable property when, on the facts and the parties' intention, they are permanently fixed as part of a going concern rather than kept for temporary use or separate sale. On that basis, the fertilizer undertaking was transferred with its plant and machinery under the conveyance deed, and their value was correctly included for stamp duty. Valuation by the revenue authorities was also upheld because it was based on the enquiry process, technical valuation material, and evidence produced by the transferee, with no arbitrariness or prejudice shown to justify interference.

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Issues: (i) Whether the plant and machinery forming part of the fertilizer business were immovable property and stood conveyed under the deed of conveyance so as to be includible in the valuation for stamp duty; (ii) whether the valuation adopted by the revenue authorities for the plant and machinery called for interference.

Issue (i): Whether the plant and machinery forming part of the fertilizer business were immovable property and stood conveyed under the deed of conveyance so as to be includible in the valuation for stamp duty.

Analysis: The character of machinery depends on the facts of each case and, in particular, on the intention with which it is embedded. On the agreement and conveyance, the fertilizer undertaking was agreed to be transferred as a going concern on an as-is-where-is basis, and the plant and machinery were described as part of that undertaking. The machinery was permanently embedded in the earth for operating the fertilizer factory and was not placed there for temporary use or for removal and sale as loose machinery. The recitals in the conveyance deed, its schedules, and the surrounding documents showed that the transfer was not confined to land alone, but extended to the entire fertilizer business including plant and machinery.

Conclusion: The plant and machinery were immovable property and were conveyed under the deed of conveyance; their value was rightly included for stamp duty purposes, in favour of Revenue.

Issue (ii): Whether the valuation adopted by the revenue authorities for the plant and machinery called for interference.

Analysis: Valuation is primarily a question of fact. The Collector relied on the enquiry process, the report of technical valuers, and the materials produced by the appellant itself. Reconstitution of the enquiry committee did not by itself show lack of authority or prejudice. The High Court had also noted that the valuation challenge was not seriously pressed before it. No arbitrariness or absence of relevant material was established to dislodge the factual finding.

Conclusion: The valuation adopted by the revenue authorities did not call for interference, in favour of Revenue.

Final Conclusion: The transfer covered the immovable plant and machinery as part of the fertilizer undertaking, and the revenue authorities rightly assessed stamp duty on that basis while also sustaining the valuation.

Ratio Decidendi: Whether embedded machinery is movable or immovable depends on the facts and, above all, the intention of the parties; where plant and machinery are permanently fixed as part of a going concern, they form part of the immovable property conveyed and may be valued accordingly for stamp duty.

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