9911796707
TMI BlogRegarding applicability of indirect taxes on packaged softwareX X X X Extracts X X X X X X X X Extracts X X X X ..... industry association on behalf of software dealers about difficulties being expressed in the assessment to customs duty of documents of title for IT software or documents that enable the transfer of the right to use such software at the time of its sale. It has been reported that there are frequent imports of such documents without any accompanying software. Such packages do not contain software but consist of paper licenses or PUK (Personal Unlocking Key, usually in the form of a scratch card of paper board or plastic) that are used to convey the right to use such IT software. The software in these cases could be freely downloadable or loaded by the OEM supplier under an arrangement with the software company as pre-loaded trial version of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctions, data, sound or image, including source code and object code, recorded in a machine readable form, and capable of being manipulated or providing interactivity to a user, by means of an automatic data processing machine. It is evident that document conveying the right to use software by themselves do not satisfy this definition and therefore do not qualify for classification under this tariff item because they do not contain any representation of instructions, data, sound or image recorded in a machine readable form, which is capable of being manipulated or providing interactivity to a user. On the other hand, tariff item 49070030 of heading 4907 refers directly to Documents of title conveying the right to use Information Technology ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t taxation of this portion of the value twice-once as Excise duty/Additional duty of Customs and another time as Service Tax on the consideration that all package software is not sold as shrink wrapped software and that affixation of retail sale price is not required for certain categories viz. (i) software on optical media supplied free of charge, for which right to use or license is purchased separately; (ii) full pack packaged software with limited validity, not for resale and generally imported for demonstrations or for OEMs; (iii) up-grade full pack-packaged software- supplied free of charge under annual maintenance/subscription/software assurance contract; and (iv) up-dates for packaged software- supplied free of charge under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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