Factory exemption for rolling stock denied where moving equipment was not machinery installed in the factory.

The exemption under Notification No. 281/86 applied only to excisable goods manufactured in a workshop within a factory and intended for use in repairing or maintaining machinery installed there. The Tribunal interpreted "installed" in its ordinary sense as set up, fixed or placed in position for service or use, and held that locomotives, rolling stock, wagons and bogies are moving items, not machinery installed in the factory. The notification was confined to machinery installed in the factory, not merely machinery used there. The goods therefore did not qualify for the exemption, and the claim was rejected.

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Issues: Whether parts of rolling stock, locomotives and similar moving equipment used within the factory could be treated as machinery installed in the factory so as to qualify for exemption under Notification No. 281/86 dated 24-4-1986.

Analysis: The notification exempted excisable goods manufactured in a workshop within a factory and intended for use in that factory or another factory of the same manufacturer for repairs or maintenance of machinery installed therein. The expression "installed" was construed in its ordinary meaning as setting up, fixing or placing in position for service or use. On that basis, the Tribunal held that locomotives, rolling stock, wagons and bogies are moving items and are not machinery installed in the factory. The notification was understood to apply to machinery installed in the factory, not merely machinery used in the factory.

Conclusion: The goods did not qualify for the exemption, and the claim was rejected.

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