Excisability of goods sent for integration at site.

[sreemannarayana B]

As per 37Border No: 58/1/2002 - CX, 'Integrated plants/machines, as a whole, may or may not be ‘goods’. For example, plants for transportation of material (such as handling plants) are actually a system or a net-work of machines. The system comes into being upon assembly of its component . In such a situation there is no manufacture of 'goods' as it is only a case of assembly of manufactured goods into a system. This cannot be compared to a fabrication where a group of machines themselves may be combined to constitute a new machine which has its own identity/marketability and is dutiable ( e.g. a paper making machine assembled at site and fixed to the earth only for the purpose of ensuring vibration free movement).

Therefore, if i send various duty paid items (bought out items not manufactured by us) to site for integration i.e connectivity between systems by plugging, will it be exempted from payment of Excise duty as per the 37B order vide para no:IV ?

 

AI Summary

Clarification on Excise Duty Exemption for Goods in Turnkey Projects Under 37B Order No: 58/1/2002-CX A query was raised regarding the excisability of goods sent for integration at a site, specifically whether such goods are exempt from excise duty under 37B order No: 58/1/2002 - CX. The order distinguishes between integrated systems not considered 'goods' and those that are moveable and thus excisable. It was clarified that if goods can be sold or shifted without dismantling, they are excisable. However, turnkey projects like steel or cement plants are not considered excisable, although their components may be. The advice was to assess the facts of each case to determine excisability.