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Issues: (i) Whether the plant and machinery forming part of the fertilizer unit were immovable property and stood conveyed under the deed of conveyance so as to be included in the value for stamp duty; (ii) Whether the valuation accepted by the revenue authorities for the plant and machinery called for interference.
Issue (i): Whether the plant and machinery forming part of the fertilizer unit were immovable property and stood conveyed under the deed of conveyance so as to be included in the value for stamp duty.
Analysis: The decisive test was the intention with which the machinery was embedded and the manner in which the business was transferred. The agreement of sale and the conveyance deed showed that the transfer was of the fertilizer business as a going concern, including the land, buildings, plant and machinery. The machinery was permanently fixed in the earth to operate a fertilizer factory and was not installed for temporary use or for removal and sale as separate movables. The recitals in the conveyance deed, read with the earlier agreement and the surrounding circumstances, established that the title to the plant and machinery also passed under the conveyance.
Conclusion: The plant and machinery were immovable property and were validly conveyed; their value was rightly taken into account for stamp duty purposes.
Issue (ii): Whether the valuation accepted by the revenue authorities for the plant and machinery called for interference.
Analysis: Valuation is primarily a question of fact. The authorities relied on the enquiry committee, the report of technical valuers and the material produced by the appellant itself. No prejudice was shown from reconstitution of the enquiry committee, and no arbitrariness or absence of material was established. In such circumstances, appellate interference with concurrent factual findings on valuation was unwarranted.
Conclusion: The valuation accepted by the revenue authorities did not warrant interference.
Final Conclusion: The inclusion of the plant and machinery in the taxable value was upheld, and the appeal failed.
Ratio Decidendi: Where machinery is permanently embedded in the earth with the intention of operating an industrial plant as a going concern, it constitutes immovable property and forms part of the conveyance if the transaction, read as a whole, shows transfer of the entire business; valuation findings based on relevant material are ordinarily not disturbed in appeal.
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