Electrical panels form part of plant and machinery when essential for operating machines, defeating the exemption claim.

Electrical panels connected to individual machines were treated as essential components of plant and machinery for eligibility under Notification No. 77/85 dated 17.03.1985, because the material showed they were necessary for operating the polishing and bevelling machines. Earlier authorities dealing with erection charges, transport charges, technical know-how fees, generating sets and moulds were found inapplicable to this dispute. The reference material also indicated that electrical installations used for productive purposes were to be included. On that basis, the panels were held includible in the plant and machinery value, and the exemption claim failed.

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Issues: Whether the value of electrical panels connected to specified machines was excludible from the computation of plant and machinery for determining eligibility under Notification No. 77/85 dated 17.03.1985.

Analysis: The claim for exclusion was examined against the material relied upon by the appellants and the cited authorities. The earlier decisions concerned different items such as erection charges, transport charges, technical know-how fees, generating sets and moulds, and did not govern the present controversy. The reference material produced by the appellants distinguished between control panel boards and other electrical installations, and also indicated that electrical installation used for productive purposes was to be included. The panels in dispute were shown against individual machines such as polishing and bevelling machines, indicating that they were linked to and necessary for operating those machines. On that basis, they were treated as essential components of the plant and machinery.

Conclusion: The electrical panels were rightly included in the value of plant and machinery, and the appellants were not entitled to the exemption. The appeals failed.

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