<...should 250 degree celcius be considered as a limitation imposed by standards or can the maximum temperature be stretched to more than that since Melting point of materials like Cu or Al ...>

Wouldn't that turn the conductor into a fuse?

I am not saying the max limit should be equal to the melting point of the condcutor..but even if it is half the maximum temperature could be around 500 degrees in case of copper..

OK. What is the melting point and the auto-ignition point of the insulation that encloses it?

What's your operating temperature?

Let's say ambient temperature is 50°C. Conductor temperature is 60°C. Now add

250°C.

That puts you at 310°C. You want to stretch that???

Common insulation will have run off the wires long ago.

Intelligence either is, or it ain't.

Thank you for proving the point.

Cable manufacturer's catalog gives SC current withstand for each size of cable

First of all your formula is wrong. It should be:

S = I Root (t) / K

S = Cross section of the conductor, in sq.mm

I = Fault current in Amperes

t = Fault duration in seconds

K = Adiabatic Constant

(In your formula, the 'k' in the denominator should have been squared and then the whold square root taken for it.)

Now, as regards the temperature limits, (250 degrees C) it is to limit the damage to the insulation (like PVC) of any cable conductors that shall be in contact with the conductors. PVC tends to soften at about 200 Degrees C.

If you make a careful study, for bare conductors, the adiabatic constant 'k' is taken considering a much higher temperature (of the order of 600 Degrees C).