Site-fixed kitchen cabinets and wardrobes treated as immovable property, defeating excise duty demand

Kitchen cabinets and wardrobes fabricated and fixed at customers' premises were treated as immovable property because they could not be removed intact and would require dismantling that damaged the underlying materials. On that factual basis, the Tribunal applied the principle that articles incapable of removal without cannibalisation do not constitute excisable goods. The demand for duty, with consequential interest and penalty, therefore could not survive, and the assessee succeeded. The impugned order was set aside and the appeals were allowed with consequential relief.

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Issues: Whether kitchen cabinets and wardrobes fabricated and installed at customers' sites are excisable goods or immovable property, and consequently whether duty, interest and penalty survive.

Analysis: The Tribunal found, on the basis of photographs and statements on record, that the installed kitchen cabinets and wardrobes could not be removed intact and would require dismantling that caused damage to granite, marine ply and panels. The items were custom-designed for specific premises and could not be shifted as such to another location. In these circumstances, the principle that articles incapable of removal without cannibalization do not constitute excisable goods applied, and the activity was treated as resulting in immovable property rather than marketable goods.

Conclusion: The goods were held to be non-excisable immovable property, so the demand could not survive and the assessee succeeded.

Final Conclusion: The impugned order was set aside and the appeals were allowed with consequential relief.

Ratio Decidendi: Articles fabricated and fixed at site, which cannot be removed without dismantling and damage, do not acquire the character of excisable goods and are to be treated as immovable property.

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