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Issues: Whether Cenvat credit on pre-fabricated shelter structures received in CKD condition and assembled at site, later fastened to the earth, could be denied on the footing that they constituted immovable property and were not capital goods.
Analysis: The eligibility to credit depended on the nature of the goods at receipt and on whether the structures, though assembled and fixed to a foundation, were truly attached to the earth in the legal sense. Applying Section 3 of the Transfer of Property Act, 1882 and the settled tests on fastening and permanence, the structures were found to be assembled from excisable components in CKD condition and installed with nuts and bolts for stability and functionality. Mere fastening to the earth for operational utility did not make them immovable property. The reasoning was consistent with the principle that credit cannot be denied where the goods remain excisable and are used for providing the output service.
Conclusion: The pre-fabricated shelter structures were held to be capital goods and not immovable property, and the appellant was held entitled to avail Cenvat credit.
Ratio Decidendi: Goods received in CKD condition and assembled at site do not become immovable property merely because they are fastened to the earth for stability and use; eligibility for Cenvat credit is determined by the character of the goods and their use, not by such incidental attachment.
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