Capital goods exemption for software development upheld for imported equipment used in export-oriented software work.

Imported building management systems, access control systems, communication equipment, voice mail systems and LCD projectors were treated as capital goods used for software development for export, and therefore qualified for exemption under Notification No. 140/91-Cus. The Tribunal accepted the certificate issued by the Chief Executive of the Software Technology Park Society, finding no material to discredit it, and followed an earlier Tribunal ruling granting the same benefit for similar equipment used in software development. On that basis, the exemption requirements were satisfied and the Revenue's challenge failed.

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Issues: Whether the imported goods, namely building management system, access control system, communication equipment, voice mail system and LCD projectors, were eligible for exemption under Notification No. 140/91-Cus. as capital goods used for development of software for export.

Analysis: The goods were found to be used in the development of software for export and to be essential for that activity. The certificate issued by the Chief Executive of the Software Technology Park Society, a Government agency, was accepted in the absence of any material to discredit it. The same issue had already been decided in an earlier Tribunal order granting the benefit of the notification for similar equipment used in software development. Following that reasoning, the goods were held to satisfy the requirements of the exemption notification.

Conclusion: The goods were eligible for exemption under Notification No. 140/91-Cus., and the Revenue's challenge failed.

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