Page 171 - GSTL_23rd April 2020_Vol 35_Part 4

2020 ] IN RE : ABB INDIA LTD. 497
The essential character of ‘immovable property’, as emerges from the
above discussion and relevant to the present context is that it is attached to the
earth, or permanently fastened to anything attached to the earth, or forming part of the
land and not agreed to be severed before supply or under a contract of supply.
4.5 In Triveni Engineering & Industries Ltd. [2000 (120) E.L.T. 273 (S.C.)]
the Apex Court observes that while determining whether an article is perma-
nently fastened to anything attached to the earth both the intention as well as the
factum of fastening has to be ascertained from the facts and circumstances of
each case.
In S/S Triveni N.L. Ltd. [RN - 910, 911 & 912 of 2001 (All)] Allahabad High
Court observes that ‘permanently fastened to anything attached to the earth’ has
to be read in the context for the reason that nothing can be fastened to the earth
permanently so that it can never be removed. If the article cannot be used with-
out fastening or attaching it to the earth and is not removed under ordinary cir-
cumstances, it may be considered permanently fastened to anything attached to
the earth.
Furthermore, in the context of the GST Act, if the article attached to the
earth is not agreed to be severed before supply or under a contract for supply, it
ceases to be goods and, for that matter, a moveable property.
4.6 In the case of Solid & Correct Engineering Works, (supra), the Apex
Court when examining whether a machine, fixed with nuts and bolts to a foun-
dation, with no intent to permanently attach it to the earth, is an immovable
property or not, has held that such an attachment without necessary intent to mak-
ing it permanent cannot be an immovable property. The emphasis is on the inten-
tion of the party. The Apex Court observes that the specific machine in question
can be moved and has indeed been moved after the road construction and repair
project, for which it was installed, is completed. However, if a machine is intend-
ed to be fixed permanently to a structure embedded in the earth, the moveable
character of the machine, according to the Supreme Court, becomes extinct.
4.7 In the present context, erection and commissioning of SCADA Sys-
tem involves attaching cables and other electrical equipment to the earth with no
intention of removing or shifting them in foreseeable future. Moreover, the parts
are so interlinked to constitute a functioning SCADA System that none can be
moved separately or without causing substantial damage to the goods attached
to earth. The moveable character of the goods like cables and other equipment,
therefore, becomes extinct. The Applicant’s supply thus amounts to erection and
commissioning of an immovable property involving transfer of property in
goods in its execution and, therefore, works contract within the meaning of Sec-
tion 2(119) of the GST Act. It now needs to be ascertained whether the Appli-
cant’s supply is ‘original work’ within the meaning of clause 2(zs) of Notification
No. 12/2017-Central Tax (Rate), dated 28-6-2017, as amended.
4.8 Original work, as defined under clause 2(zs) of Notification No.
12/2017-Central Tax (Rate), dated 28-6-2017, means all new constructions involv-
ing (i) all types of additions and alterations to abandoned or damaged structures
on land that are required to make them workable, and (ii) erection, commission-
ing or installation of plant, machinery or equipment or structures, whether pre-
fabricated or otherwise. The Applicant’s supply is not in the nature of repair and
maintenance of an existing structure, but a new construction. As already dis-
cussed, it involves installation, erection and commissioning of a network of inter-

GST LAW TIMES  23rd April 2020  291