2005 (9) TMI 455 - AT - Central Excise

Summary

Issues:
1. Benefit of exemption under Notification No. 205/88-C.E. for electric storage batteries.
2. Classification of wooden stands as articles of wood under SH 4410.90 of the CETA Schedule.

Issue 1: Benefit of Exemption for Electric Storage Batteries
The appeal by the Revenue challenged the lower appellate authority's decision granting exemption under Notification No. 205/88-C.E. to the assessee for "electric storage batteries." The respondent argued that the batteries were used as parts of wind mills, making them eligible for exemption under Sl. No. 12 of the notification. The Tribunal analyzed the purpose of the batteries, noting that they stored energy generated by wind mills for conversion and consumption. It was established that only small-sized wind mills required batteries for energy storage, while larger mills did not. Consequently, the Tribunal concluded that batteries were not integral parts of all wind mills, thus not qualifying for the exemption. The Tribunal distinguished this case from a previous decision involving bolts and screws essential for cycles and cycle rickshaws. Additionally, a precedent was cited where a battery was deemed not a part of electronic medical equipment, supporting the view that general-purpose batteries could not be considered parts of wind mills.

Issue 2: Classification of Wooden Stands
Regarding the classification of "wooden stands/racks," the Tribunal observed that these items were designed specifically for holding batteries at elevated levels and providing insulation from the ground. It was determined that these stands were not to be categorized as furniture under Heading 94.03 but rather as articles of wood under Heading 44.10, as contended by the assessee. Consequently, the Tribunal set aside the lower authority's decision on the exemption for batteries but upheld the classification of the wooden stands/racks as articles of wood. The appeal by the Revenue was partially allowed based on these findings.

In conclusion, the Appellate Tribunal CESTAT, Chennai, in the judgment dated 28-9-2005, addressed the issues of exemption eligibility for electric storage batteries and the classification of wooden stands. The Tribunal ruled that while the batteries did not qualify for the exemption under Notification No. 205/88-C.E. as they were not essential parts of all wind mills, the wooden stands were correctly classified as articles of wood.