9911796707
TMI Blog2003 (6) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... b-heading 8471.60. The Commissioner (Appeals) has, however, reversed the order of the Assistant Commissioner. The present appeal has been filed by the department seeking restoration of the Order-in-Original on the following grounds :- (1) Printers are sold along with software and the price of the driver software is included in that of the printer. No split value for driver software is either in the invoice or in the price list. (2) The driver software is universally and compulsorily supplied along with the printer without it a printer cannot function. (3) Commissioner (Appeals) incorrectly relied upon the Apex Court decision in the case of M/s. PSI Data System Ltd. - 1997 (89) E.L.T.3 (S.C.), as the said decision dealt with assessable value of computer for the purpose of excise duty in the context of what was subject to excise duty under the relevant tariff entry was computer and not computer system. (4) The Customs Tariff differs from Central Excise Tariff to the extent that Heading 8471 also covers computer system and more- over, under Section 19(b) of the Customs Act, 1962 and the Accessories (Conditions) Rules, 1963, there are provisions for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nit of Data processing system under heading 84.79 and not as software under heading 85.24, since such software installed on the hard-disk drive becomes integral part of the hard-disk drive. 9.We note that according to Rule 1 of the General Interpretative Rules (GIR), classification has to be determined according to the terms of the headings and any relative Chapter Note. Chapter Note 6 under Chapter 85 states that records, tapes and other media under Heading 85.23 or 85.24 remain classified in those headings, when they are presented with the apparatus for which they are intended. In view of this Chapter Note, there can be no doubt about classification of the driver software on CD imported along with printers - the printers are classifiable under 8471.60 whereas the driver software on CD remains classified under Heading 85.24. The case law cited by the learned JDR is of no avail as this is not a case where the software is either embedded or integrated with the apparatus but is imported along with it separately. 10.As regards the second question, it has been contended by the learned Advocate for the Respondent that after amendment of the Customs Tariff Act in 1986, Section 19(b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r (Appeals)'s order or the department's appeal refers to this aspect. We must overrule the Dy. Commissioner's order that the Section 19(b) of the Customs Act, 1962 can be resorted to. In our order of Monito Enterprise - 1999 (111) E.L.T. 918 we had said specifically that the provision of Section 19(b) of the Act could not be resorted to after the Customs Tariff Act was enacted in 1986." (Paragraphs 6 and 7). 12.It is the contention of the learned Advocate for the Respondent that in view of these decisions of the Tribunal, after amendment of the Customs Tariff Act in 1986, the provision of Section 19(b) has become totally redundant. 13.With great respect, we are unable to agree with the suggestion that either sub-section (b) of Section 19 or Section 19 of the Customs Act, 1962 in its entirety has become redundant, after amendment of the Customs Tariff Act in 1986. We observe that Section 19 is an important provision of Customs law which provides for determination of duty where goods consist of articles liable to different rates of duty. We extract the said section below :- Determination of duty where"SECTION 19. goods consist of articles liable to different rates of duty. - Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re are entries in the Customs Tariff which are specifically meant to cover sets, e.g. Heading 63.08 covers sets consisting of Woven fabric and yarn, whether or not with accessories, for making up into rugs, tapestries, embroidered table cloths or serviettes; or similar textile articles, put up in packings for retail sale. There are examples of other articles put up in sets for retail sale, which are not specifically covered under any particular heading but by application of G.I.R. 3(b), such sets can be uniquely classified as if they consisted of the material or component which gives them their essential character, in so far as this criterion is applicable. But there can be sets of goods which are mere collection of articles which cannot be classified either under a specific heading per se or under a unique heading by application of G.I.R. 3(b). Such collection would have separate classification for each of its constituent article. G.I.R. 3(b) can be applied only when a set consists of a material or component which gives the whole set its essential character. In the instant case neither the printer nor the software can be said to give the set its essential character. In fact, the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty. Application of Section 19(b) would require both items to be charged to 15% of duty on the combined value. Even application of proviso (a) to Section 19 which requires accessories to be assessed at the rate applicable to the article would result in charging of 15% on the driver software which is an accessory for the printer in question in view of the fact that such software is compulsorily supplied along with the printers and no separate charge is made for its supply, price being included in the price of the printer. 19.As noted earlier in terms of proviso (b) to Section 19, it is possible to separately assess the driver software provided the importer produces evidence to the satisfaction of the proper officer regarding separate value of the same. Apart from the fact that the price for the software has not been indicated separately either in the invoice or in the price list, the appeal memorandum filed by the Department indicates that the split of the value is not reasonable and is artificially done. Therefore, we hold that the satisfaction of the proper officer required under the said proviso (b) to Section 19 does not exist. 20.Accordingly, we hold that the printer merits ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
