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1. This is a Revenue appeal against the order in appeal No. 85/89(B) dated 31.3.1989 passed by the Collector of Central Excise (Appeals), Chennai holding that the cable assemblies which are the subject matter of dispute for classification are classifiable under chapter heading 8473.00 and to that extent modified the order in original passed by the Asstt. Collector.

2. The Asstt. Collector in his order in original had held that with effect from 1.3.1987, the cable assemblies should be classified under heading 8554 of the CET 1985 and confirmed the differential duty involved for the period from 1.3.1987 to 29.2.1988 to the extent of Rs. 32,340.10 and for the period 1.3.1988 to 31.5.1988 Rs. 4280.65 SED and Rs. 214.05 BED. The assessee's contention before the Collector (Appeals) was cable assemblies by definition as contained in tariff heading 8544 includes cable connected with a connector. Thus, what the assessee buys from the market is a cable and what he sells is also a cable. It was urged that the tariff classification remains unchanged to heading 8544 and hence duty cannot be demanded twice under the same heading, once from the supplier and the second time from the assessee. It was also urged by the assessee that mere fixing of a connector to a cable assembly does not amount to manufacture. It was also urged that the Asstt. Collector erred in not appreciating that if a manufacture is involved on the part of the assessee then the manufactured product viz. cable assembly can no longer be in the realm of sub-heading No. 8544.00 of the CET but has to be regarded as a component part of the computer distinct from a cable. It was also contended that in such an event the Asst. Collector ought to have held that while the input is cable the finished goods is an assembly and component part of the computer different from cable and he ought to have classified the cable assembly under sub-heading 8473.00 as part of computer. It was also contended that tariff heading 8544 deals with cable and not cable assembly if cable and cable assembly are one and the same product and both belong to heading 8544.00 then, the Asst. Collector should have held that no further manufacture is involved and duty cannot be charged to them. It was also urged that if cable and cable assembly are two different goods then he ought to have held that the goods under heading 8544 covers only cables and not cable assembly. The Collector (Appeals) reproduced the finding given by the Asst. Collector in para 10 of the order in original wherein the Asst. Collector has observed that Section note 2(a) being relevant in the case the conductors with connectors are specifically covered by heading 8544 of Chapter 85. Cable assembly which is a conductor with connector has to be classified under heading 8544 which is the specific heading which covers cable and other insulated electric connectors whether or not fitted with conductors. The Asst. Collector observing the above section noted that but for Section note 2(a) of Section XVI cable assemblies would have been classified under heading 84.73 as part of computer. The Collector (Appeals) noted that a reading of heading 8544 it is seen that cable with insulated electric conductors whether or not fitted with connectors are classified under heading 8544. Similarly, optical fibre cables made up of individually sheathed fibre whether or not assembled with electric conductor fitted with connectors are also classifiable under heading 8544. He also held that in the present case it is not a cable and other insulated electric conductor which is purchased by them and fitted with connectors. They do something more. By such fitment with connectors they render such cables solely suitable for use in computers. He has held that therefore, the goods manufactured by them are not covered under tariff heading 8544 as there is no mention of cable assembly under tariff heading 8544. He has held that the assessees buy cable from the market and by connecting them with connectors render them suitable for use only for computers and no other machinery. The cable assembly sold by them is manufactured by them. Connecting the cables in a particular manner with connectors, appellants make them solely usable as part of computers and the assessees do not contend any other use for such cable assemblies. He noted that they do not sell cables with connectors but sell cable assemblies solely suitable for computers. He held that the assessees' contention that there is no manufacture is not correct. He observed that the AC's contention on the other hand that cable assemblies are specifically covered under heading 8544 is also not correct because cable assemblies with particular use as a part of computer cannot be held to be insulated cable or other insulated electric conductors fitted with connectors, but something more has come into existence i.e. a part of computer and hence he held that the alternative plea raised by assessee for classification of the goods under heading 8473 is required to be accepted.

4. We have heard Shri S. Kannan, learned DR for the Revenue and Shri R. Ravindran, learned Counsel for the respondent.

5. Shri S. Kannan, learned DR drew our attention to the grounds of appeal and also to the assessee terming the item as "cable assembly". He submitted that its use in the computer, is not material for the purpose of classification. It has assumed the function of a cable and merely because it has been connected with a pin, therefore, that by itself, cannot become part of computer as the function of the cable to conduct electricity is not changed. He submitted that the item cannot be considered as part of computer on the ground that it conducts data as there is no such thing as conducting data. Data is conducted in the form of electricity impulse through the conductor only and what is conducted is electricity. Thus impulse gets reconverted and read as data. The item is a metal conductor in plastic which conducts electricity. There is no difference between the normal wire and the item in question except in the form of construction as the form is different due to specific usage. He illustrated the point by stating that electricity is conducted into the form of AC/DC current and because DC current is employed that by itself it does not make the item different from conductor. These conductors are equivalent to plugs; because of miniature condition in the electronic circuit, therefore these conductors are utilised. He further eleborated by stating that these items are standard items and are independently marketed products. He further clarified that conductors with sheaths or without it fall under heading 8544 and it is not specific to computer alone. It is an item generally used to a category of computers. He also pointed out to IBM conductors which are comparable ones. There is nothing like an item being manufactured to a specific computer. He pointed out from the literature that the standard pins in conductors are being used which is a general item. He submitted that the ratio of the judgement rendered in the case of Toshniwal Cables v. CCE applies to the facts of the present case. He submitted that since there is specific heading for cables and other insulated electric conductors whether or not fitted with conductors therefore it has to be classified under the description appearing under heading 8544.

7. On consideration of the submissions made and on perusal of the technical literature, it is clear that the item has been specifically designed with a specific part number. Pins are attached to the cables and the design fit into the computer system and each of the pin conduct one particular type of signal to the computer and this is the most distinguishing feature and in view of the specialised cable assembly which makes the item a part of the computer system. The respondents have given a detailed technical literature with specific drawing and specific pin numbers which gets attached to the particular P.C. end of a computer. Having been designed to a particular computer and being not freely available in the market and being a specific item for each specific computer, therefore, the item cannot be considered as general purpose one, as the item has assumed a speciality, which is distinguishable. Therefore the other general purpose cable and other insulated electric conductors whether or not fitted with conductors are for classification under heading 8544. The learned DR stressed the fact that the heading reads "whether or not fitted with conductors" is sufficient for classifying the item under heading 8544 by virtue of Section note 2(a) is not acceptable for the reason that conductor is not a general purpose conductor or a generalised switch assembly or a socket, which is standard one. The connector in the present case is fixed with specialised pins which are very minute and each cable has an assembly of pins of more than 25 in number and each of these pin carries a particular signal. It has a pin number and each one carries one type of data signal. The details as noted in the technical literature are reproduced hereunder: