Essential character controls classification of paper-insulated copper winding wire, preserving concessional exemption for winding wires.

Paper-insulated copper winding wire retained its essential character as winding wire for exemption purposes; mere paper insulation did not shift it to the general insulated wire/cable entry. The specific concessional exemption for winding wires made of copper under Notification No. 69/86-CE applied because the goods' commercial identity remained winding wire, making the insulated wire entry inapplicable. The article therefore treats classification by essential character as decisive where the product remains a winding wire in substance, despite added insulation.

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Issues: Whether paper insulated copper winding wire is classifiable as winding wire made of copper so as to qualify for the concessional exemption under Sl. No. 1(ii) of Notification No. 69/86-CE, or whether it falls under the entry for insulated wire/cable.

Analysis: The governing notification granted concessional duty for winding wires made of copper falling under heading 85.44, while a separate entry prescribed a higher rate for insulated wire/cable. The product was not disputed to be winding wire; the dispute was only whether paper insulation changed its character. Since the essential identity of the goods remained winding wire, mere paper insulation did not take it out of the specific entry for winding wires. The separate insulated wire entry was therefore inapplicable.

Conclusion: The goods were entitled to exemption under Sl. No. 1(ii) of Notification No. 69/86-CE, in favour of the assessee.

Final Conclusion: The appeal succeeded on merits and the concessional duty benefit was available to the goods as classified by their essential character.

Ratio Decidendi: Where a product remains, in substance and commercial identity, a winding wire, superficial insulation does not displace it from a specific exemption entry for winding wires merely because an alternative entry exists for insulated wires.

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