2004 (4) TMI 223

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..... ry has held that the appellant should discharge duty on the computers after including the value of the software also in the assessable value. Para 39(i) of the Order states as under : "39(i) That the value/cost of the Operational Software installed by the assessee on the computers before clearance from the factory is includible in the assessable value/transaction value of the computer system and therefore, the differential duty demanded in the two show cause notices need to be confirmed." From the foregoing, it is clear that duty demands have been made on the basis that computer system (not computer alone) is being assessed. Penalty has also been imposed along with demand of interest. 2. The contention of the appellant is that duty de .....

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..... e value of software sold along with computers. Learned Counsel has pointed out that the distinction between computers and software is clearly understood. Learned Counsel has also relied on the decision of the Apex Court in the case of Sprint RPG India Ltd. v. CC-I, Delhi - 2000 (116) E.L.T. 6 (S.C.) and many other decisions on the subject. 4. We have perused the records and have considered the submission made by both sides. The demand in the case is on account of a finding that value of operating software should be included in the assessable value of the computers. This finding of the Commissioner is clearly contrary to the decision of the Apex Court on the subject. In PSI Data Systems Ltd. v. CCE, the Supreme Court has held as under: .....

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..... corded, would be covered by Heading 85.24. Rule 3(a), inter alia, provides that when two or more headings each refer to part only of the materials or composite goods, those headings are to be regarded as equally specific in relation to those goods, even if one of item gives a more complete or precise description of the goods. Further considering imported goods to be a mixture of two substances namely 'hard disk drive' and 'software' as per Rule 3(b) they can be classified under the heading which gives them their essential character. In the present case, considering its price factor it would be computer software. The price of the imported consignment was approximately Rs. 68 lakhs. As against this value of the seven hard disk drives would be .....

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