2007 (11) TMI 232 - AT - Central Excise

On basis of various tests of classification, transmission line can t be considered as electrical apparatus - appellants plea for classification of conductors as parts of electrical apparatus doesn t succeed - transmission line & electrical machinery/apparatus are different as transmission lines carry electricity from one point to another, whereas electrical machinery/apparatus use electrical energy for performing specific functions hence for electric goods CH 85.44 is appropriate than 85.48

Issues Involved:
1. Classification of various goods declared by the appellant.
2. Whether transmission lines can be considered as electrical apparatus.
3. Proper classification of specific products under the Central Excise Tariff Act, 1985.

Detailed Analysis:

1. Classification of Various Goods Declared by the Appellant:
The appellant contested the classification of goods declared in the classification list effective from 20-3-90. The Revenue issued a Show Cause Notice (SCN) dated 13-7-1990 questioning:
- Why products declared under heading 7308.00 should not be classified under 7326.90 based on their constituent material, predominantly Iron & Steel.
- Why products under heading 3548.00 should not be classified under 7616.90 as articles of Aluminium.
- Why Bus bar etc. should not be classified under 7608.20 as Aluminium Tubes.

The Assistant Collector, after hearing, classified the goods and levied duty as follows:
- Hardware fittings and conductor accessories predominantly of Iron or steel under sub-heading 7326.90.
- Hardware fittings and conductor accessories predominantly of Aluminium under sub-heading 7616.90.
- Tubular Bus bar of Aluminium under sub-heading 7608.20.

The appellant's appeal to the Collector (Appeals) was rejected, confirming the classification based on constituent base metals. The Tribunal also upheld this classification.

2. Whether Transmission Lines Can Be Considered as Electrical Apparatus:
The principal grievance of the appellant was whether transmission lines were machinery or apparatus. The Tribunal observed that transmission lines, consisting of electricity conducting cables and supporting towers, cannot be called machinery or apparatus. Accessories and fittings used in transmission lines do not qualify as electrical parts of machinery or apparatus. The Tribunal concluded that the correct classification, in terms of Note 1(f) to Section XV, is under Section XV, confirming the classification under Chapters 73 & 76.

The Hon'ble Supreme Court directed the Tribunal to reconsider whether transmission lines could be apparatus and if the products could be described as electrical parts. The appellant argued that their products were electrical parts and should be classified under heading 85.48, citing technical literature, ISI specifications, and customer requirements. They contended that the products were tailor-made components for power transmission and not general hardware items.

3. Proper Classification of Specific Products Under the Central Excise Tariff Act, 1985:
The Tribunal analyzed the technical literature and market parlance, concluding that transmission lines are not apparatus. The Tribunal noted that conductors are primary goods used for power transmission, while apparatus serve specific functions at the secondary stage. The Tribunal relied on various principles of interpretation of taxing statutes, including market practice and the legal text contained in Chapter Notes.

The Tribunal held that conductors are electrical goods but not apparatus, and thus, should not be classified under heading 85.48. The classification approved by the authorities based on the material used in the goods was upheld.

Conclusion:
The appeals filed by the appellant were dismissed, confirming the classification of goods under the relevant headings based on their constituent materials. Transmission lines were not considered as electrical apparatus, and the products were not classified under heading 85.48. The Tribunal's decision was supported by technical literature, market parlance, and principles of interpretation of taxing statutes.

← Previous Next →