Classification of power-plant components as parts, not a complete generating set, under the customs tariff headings

Imported power-plant components were not treated as a complete electric generating set because they consisted only of separate items and not a machine or combination of machines forming a clearly defined function. Note 4 to Section XVI was held inapplicable. The alternator with controls and the lube oil condensing system were classifiable as parts suitable for use with electric generating sets under Heading 85.03, while the steam turbine fell under Heading 84.06. The goods were therefore to be assessed on their own merits rather than as a generating set, and the classification adopted by the adjudicating authority was found incorrect.

---

---

Issues: Whether the imported components for a power plant, namely the alternator with controls, steam turbine and lube oil condensing system, were classifiable as electric generating sets under Heading 85.02 or as parts under Heading 85.03 and Heading 84.06.

Analysis: The imported goods were only three separate components and not a complete machine or a combination of machines forming a clearly defined function. Note 4 under Section XVI was therefore inapplicable. The alternator and lube oil condensing system were parts suitable for use with electric generating sets and were classifiable under Heading 85.03. The steam turbine was specifically covered by Heading 84.06. The goods had to be assessed on their own merits and not treated as a complete generating set.

Conclusion: The classification adopted by the adjudicating authority was incorrect. The appeal succeeded and the goods were held classifiable as parts under the relevant headings, in favour of the assessee.

---