Tariff classification of paper software licences under Heading 4907, not as software or other printed matter

Paper licences that merely convey the right to use information technology software, without containing machine-readable software themselves, are classifiable under Heading 4907 as documents of title. Heading 8523 applies only to information technology software in machine-readable form, so a paper licence alone does not fall there. Heading 4911 was also inapplicable because the goods were not PUK cards or other printed matter of that kind. The classification was therefore upheld under Heading 4907, consistent with the tariff interpretation rules and the Board circular.

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Issues: Whether paper licences imported without accompanying software were classifiable under Heading 4907 as documents of title conveying the right to use information technology software, or under Heading 8523 as information technology software, or under Heading 4911 as other printed matter.

Analysis: The imported goods were only paper licences and not software media or PUK cards. Under Rule 1 of the Rules for the Interpretation of the Tariff Schedule, classification must follow the terms of the heading and relevant chapter notes. Heading 8523 covers information technology software, which requires a machine-readable representation of instructions, data, sound or image, whereas a paper licence by itself does not contain such material. Heading 4907 expressly covers documents of title conveying the right to use information technology software. The Board circular also clarified that paper licences merit classification under Heading 4907, while PUK cards fall under Heading 4911. As the goods were not PUK cards, the departmental classification could not be sustained.

Conclusion: The paper licences were correctly classifiable under Heading 4907, not under Heading 8523 or Heading 4911, and the assessee succeeded.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential reliefs.

Ratio Decidendi: Paper licences that merely convey the right to use software, without containing machine-readable software themselves, are classifiable under the tariff heading for documents of title and not as software or other printed matter.

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