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2005 (7) TMI 469 - AT - Central Excise
Issues:
1. Whether the applicant is entitled to the benefit of Notification No. 11/97-Cus exempting computer software from customs duty. 2. Whether the subsequent amendment to the notification, specifically on 11-2-98, affects imports made prior to the amendment. Analysis: 1. The applicant imported software claiming exemption under Notification No. 11/97-Cus, which exempted computer software from customs duty. A show cause notice was issued in 1998 challenging the entitlement to this exemption, arguing that the imported goods were not computer software but software for telecom equipment. 2. The applicant contended that the subsequent amendment on 11-2-98, restricting the exemption to only computer software, was prospective and did not apply to imports made before the amendment. They argued that their software fell under the definition of computer software based on technical distinctions between operational and application software. 3. The Revenue, however, maintained that the imported software did not qualify for the exemption under the Board's clarification and the subsequent amendment. The clarification specified that software for telecom, medical, or other applications was not eligible for duty exemption. 4. The Tribunal observed that the import was made in October 1997 when the Notification No. 11/97-Cus covered computer software. The amendment on 11-2-98 was deemed prospective, as clarified by the Board, and excluded software for specific functions other than data processing from the exemption. Consequently, the Tribunal found that the applicant had a strong case in their favor, and the pre-deposit of duty for the appeal was waived, allowing the stay petition. 5. Due to the significant amount involved, the Tribunal agreed to list the appeal for hearing after two weeks. This decision was pronounced and dictated in the open court, granting relief to the applicant based on the interpretation of the notification and the timing of the import in relation to the subsequent amendment.
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