Assessable value of pumps excludes separately supplied electric motor when it is not an integral composite machine.

The optional electric motor supplied separately with power-driven pumps was held to be a distinct article and not an integral component of the pump, because it was not built into or mounted with the pump and the combined supply did not meet the HSN Section XVI notes for a single composite machine or integrated entity. On that basis, the motor's value was excluded from the assessable value of the pumps, and the assessee succeeded.

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Issues: Whether the value of the bought-out electric motor supplied optionally along with power driven pumps was includible in the assessable value of the pumps.

Analysis: The supply arrangement showed that the electric motor was not built into or mounted with the pump, but was supplied separately only to customers who opted for it. The relevant classification principles under Section Notes 3 and 4 to Section XVI of the HSN were considered, but the combined supply did not satisfy the conditions for treating the pump and motor as a single composite machine or as an integrated entity performing one defined function. Following the earlier Tribunal view, the motor was treated as a distinct article and not an integral component of the pump.

Conclusion: The value of the electric motor was not includible in the assessable value of the power driven pumps and the appeal succeeded in favour of the assessee.

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