Value of Bought-Out Items Not Includible in Assessable Value of Boiler Assembled at Site, Holds Final Plant is Non

The Supreme Court of India, in a significant judgment on central excise law, has ruled that the value of duty-paid “bought out items” delivered directly to a buyer’s site is not liable to be included in the assessable value of a boiler cleared from the assessee’s factory in a completely knocked down (CKD) condition.

A bench comprising Justice J.B. Pardiwala and Justice Sandeep Mehta , while allowing the appeals in Lipi Boilers Ltd. v. The Commissioner of Central Excise, Aurangabad , held that the final steam generating plant, after erection and installation at the site, becomes an “immovable property” and thus does not constitute “excisable goods.”

The Court also invalidated the show cause notice issued by the revenue, holding that the extended period of limitation under Section 11A(