Customs, Excise and Gold Tribunal - Delhi
Jasmine Telecom India Ltd. vs Commissioner Of Customs (Acu) on 15 March, 2002
Equivalent citations: 2002(145)ELT63(TRI-DEL)
ORDER V.K. Agrawal, Member (T)
1. The issue involved in this appeal filed by M/s. Jasmine Telecom India Ltd. is whether benefit of Notification No. 11/97-Cus. is available in respect of 'Neos Software Licence', imported by them.
2. Shri K.K. Anand, learned Advocate, submitted that Sl. No. 173 of the Notification No. 11/97 exempts Computer Software from payment of customs duty; that the Software imported by them is an operative system software which was must to run any other software just like MS DOS UNIX; that the Department is of the view that for customs purpose, the word computer has to be interpreted as an automatic data processing machine falling under Heading 8471 of the Customs Tariff; that Appellate Tribunal, in the case of BPL Mobiles Communication Ltd. v. Commissioner of Customs, 2000 (126) E.L.T. 986, has extended the benefit of the Notification to all other Software; it was held by the Tribunal that the Computer Software contained in tapes, Disk or CD ROMS used for different specific functions are entitled to duty exemption under Sl. No. 173 of the Notification No. 11/97; that this decision has been confirmed by the Supreme Court as Civil Appeal Nos. 7158-7161 of 2000 filed by the Commissioner had been dismissed by the Supreme Court on 16-8-2001. Learned Advocate alternatively submitted that the appellants have imported software which was loaded on hard disk and the duty is, therefore, leviable at the rate applicable to hard disk. He claimed the benefit of Sl. No. 160 of the table annexed to Notification No. 11/97 which provides concessional rate of duty in respect of Hard Disk.
3. Countering the arguments, Mrs. Krishna Mishra, learned SDR, submitted that it has been held by the Supreme Court in the case of Sprint RPG India Ltd. v. Commissioner of Customs-I Delhi - 2000 (116) E.L.T. 6 (S.C.) that Computer Software loaded on Hard Disk drive is assessable on the basis of Computer Software and not as Hard Disk simplicitor since what was imported was Software on a Hard Disk. Learned SDR, further, submitted that the Sl. No. 173 of the notification exempts Computer Software and not Software in general; that the notification has to be interpreted strictly on its own terms and every Software cannot be treated as Computer Software; that the Sl. No. 173 will not apply to Software which is required for operation of any machine for performing a specific function other than data processing; that since in the present matter the impugned Software is for telecommunication purpose, benefit of notification is not available to the impugned goods.
4. We have considered the submissions of both the sides. The exemption under Sl. No. 173 of the Notification No. 11/97-Cus., dated 1-3-97 is available to Computer Software. No doubt it has been held by the Appellate Tribunal, in the case of BPL Mobile Communications, that it is wrong to deny exemption to Software required for operation of any machine for performing a specific function other than data processing. The Tribunal has, further, held that the object of Note 5(E) to Chapter 84 is to "ensure that machines which are intended for purposes other than data processing, which incorporate, or work in conjunction with data processing machines are to be classified, not as such data processing machines but in terms of their functions". The Tribunal, further, held that this "does not detract from the very fact that the data processing machines which are incorporated, in or used with such machines, are by themselves data processing machines" and "the Software for such machines would be in any case the software for data processing machines" we find that no technical litrature or data has been brought on the record to show whether the impugned software is used in a system which contains any automatic data processing machines. Merely because the impugned software is to be used for telecommunication purposes it cannot be termed as a computer software. In absence of any technical data available on record, it is not possible to decide the matter conclusively. We, therefore, remand the matter to the adjudicating authority for afresh adjudication after taking into consideration the technical data and working of the machines in which the impugned software is to be used. The appeal is thus allowed by way of remand.