Complete machinery test excludes electrolytic cells for hydrogen gas where essential ancillary equipment is missing; exemption applies.

Electrolytic cells manufactured for producing hydrogen gas were not "complete machinery" because the production process also required essential ancillary equipment, including pipelines and storage tanks, which was not shown to have been manufactured by the appellants. As the goods did not satisfy the description of complete machinery, the exemption under Notification No. 118/75-C.E. remained available. On that basis, the denial of exemption was incorrect, and the consequential confiscation and penalty could not stand.

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Issues: Whether electrolytic cells manufactured for production of hydrogen gas constituted "complete machinery" so as to fall outside the exemption under Notification No. 118/75-C.E. dated 30-4-1975.

Analysis: The cells, even if treated as machinery for producing hydrogen gas, were not by themselves complete machinery in the context of the intended use. The production process required additional essential equipment such as connecting pipelines and storage tanks for transport and storage of the gas. Since such ancillary and necessary equipment was not shown to have been manufactured by the appellants, the goods did not answer the description of complete machinery. On that basis, the benefit of the exemption notification could not be denied. Once the exemption was available, the confiscation and penalty ordered on the same footing were also unwarranted.

Conclusion: The electrolytic cells were not complete machinery. The denial of exemption was incorrect, and the confiscation and penalty could not stand.

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