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TMI Blog2003 (5) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Commissioner (Appeals), accepted the proposal in the notice demanding duty consequentially required. The Assistant Commissioner's order imposing penalty has been set aside by the Commissioner (Appeals). Hence this appeal. 1. Heading 85.24 and the relevant sub-headings, as this stood at the relevant time, are reproduced below :- Heading No. sub-heading No. Description of goods 85.24 Records, tapes and other recorded media for sound or other similarly recorded phenomena, including matrices and masters for the production of records, but excluding products of Chapter 37 8524.10 - Gramophone records 8524.20 - Software Magnetic ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tever method adopted, the net result that we are concerned is a packed disc containing on it data in digitised form. 4. We note here that the process that the appellant adopts for the manufacture of its recorded compact disc, by employing the stamper which impresses by means of each the data is impressed upon the material which dispute the compact disc is not dissimilar to the manufacture of gramophone records using the material made out of the master records. Therefore, it is completely irrelevant whether the appellant manufactured the recorded media directly, or by first taking the unrecorded discs and thereafter imprint the data upon it. 5. The Deputy Commissioner proceeds to decide the issue by application of what is called "univers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... self and for it to be put to use it has necessarily to exist on some suitable medium such as a floppy disc or a tape or a compact disc. Once it is accepted, as the Deputy Commissioner does, that software recorded on to an existing unrecorded compact disc renders that disc an item of software it would necessarily to follow that the software recorded directly in the course of manufacture of the compact disc is also an item of software. 7. The appeal would have to be allowed on another ground too. Prior to 1996, there was no separate sub-heading in Heading 85.24 specifically for software. In 1996, a sub-heading 20 was introduced covering "computer software". The appellants had cited before the Commissioner (Appeals) the Board's circular 7/98 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nacceptable. If interactive software containing encyclopedia, books, is eligible for the exemption, there is no reason why the software of the kind that the appellant manufactured, which stands on the same footing should be treated differently. In the absence of any definition of software in the tariff heading, it would be appropriate to apply the definition contained in the Notification No. 11/97 issued under the Customs Act, 1962. 9. It is not possible to accept the Commissioner (Appeals) view that the software in question is not interactive. The difference between the interactive software and other software is clearly explained in Dictionary of Computer Terms, Third Edition as under : Batch Processing : In batch processing the user g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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