2000 (2) TMI 235 - AT - Central Excise

Appellate Tribunal denies duty exemption for insulated cables used in windmills

The Appellate Tribunal CEGAT, New Delhi upheld the decision denying duty exemption for insulated cables classified as parts of windmills. The ... Exemption as parts of windmills - classification of insulated cables as parts of a machine - identifiability of component parts for concessional notification - distinguishing precedent on factual matrixExemption as parts of windmills - classification of insulated cables as parts of a machine - identifiability of component parts for concessional notification - Whether insulated cables cleared by the assessee at nil rate under the Notification as parts of windmills qualify as parts of windmills and are eligible for the exemption. - HELD THAT: - The Tribunal held that the windmill is a selfcontained device whose primary components (blades, shaft, generator, coupling) effect conversion of wind to mechanical and electrical energy. The insulated cables supplied by the appellant are used to transmit electrical energy from the generator to distribution and, although necessary for the functioning of the windmill installation, are not integral or identifiable parts of the windmill itself. The decision relied on the factual distinction from the cited precedent where power cables were cut to specific sizes, fitted with end fittings, integrated within the nacelle and supported by a supplier's technical certificate establishing the cables as internal components performing specific dual functions. In the present case the appellant failed to establish that the cables manufactured were identifiable component parts of the windmill; consequently the concessional treatment under the Notification could not be allowed.Benefit of exemption under the Notification is not available on the insulated cables; the demand is upheld and the appeal rejected.Final Conclusion: The Tribunal affirmed the departmental demand, holding that the insulated cables cleared by the appellant are transmission accessories and not identifiable parts of windmills eligible for the concessional exemption; the appeal is dismissed. The Appellate Tribunal CEGAT, New Delhi upheld a decision regarding the classification of insulated cables as parts of windmills for duty exemption. The manufacturer's appeal was rejected as the cables were not considered identifiable parts of windmills. The decision was based on the function and design of windmills, distinguishing it from a previous case involving power cables.