Conveyor support structures treated as part of plant and machinery, making Modvat credit available.

Structures fixed as supports for a conveyor system, and manufactured to its design and specifications, were treated as part of the conveyor system itself. Because they were shown to be integral and necessary for effective operation, and not materials used for civil construction or a shed, they qualified as capital goods eligible for Modvat credit under Rule 57Q. Authorities allowing credit on supporting structurals forming part of plant and machinery were followed, while cases involving civil construction materials were distinguished on facts.

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Issues: Whether structures fixed as supports to a conveyor system, and manufactured according to its design and specification, qualify as parts of the conveyor system and therefore as capital goods eligible for Modvat credit under Rule 57Q.

Analysis: The structures were found not to be used for civil construction or for putting up a shed. They were supported by photographs and the factual position that they formed an integral and necessary part of the conveyor system, without which the system could not function effectively. The reasoning in the cited authorities allowing credit on supporting structurals used as part of plant and machinery was applied, while the decisions dealing with construction materials used for civil structures were distinguished on facts.

Conclusion: The structures were held to be part of the conveyor system and eligible for Modvat credit. The denial of credit was not justified.

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