1997 (12) TMI 239

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....pellate authority has held that the value of extra disc drive supplied with the computer system are required to be taken into reckoning for arriving at the assessable value and also that the amount relatable to the freight and insurance on production of evidence in this regard are required to be abated from the sale price for assessment purposes. 3. The revenue is aggrieved against this finding of the lower appellate authority and in the grounds of appeal, the following has been urged : 1. The Collector of Central Excise (Appeals), Madras has come to a wrong conclusion by allowing extra peripherals which cannot be used in the computers system at any point of time, as spares. The contracts entered into between the respondents....

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....ght out or otherwise in excess of one number supplied by the assessee along with the computer in compliance with commitment/agreement is includible in the assessable value as laid down in the case of Collector of Central Excise v. M/s. Sunray Computers Private Limited [Order No. 851/87-A, dated 17-12-1987 - 1988 (33) E.L.T. 787 (Tribunal)], wherein it is held that is there is a single contract for the supply of a computer, including software, the total value of the computer including that of software would have to be assessed to duty irrespective of the fact whether the software parts is supplied along with the hardware or in a separate lot. 4. Shri V. Thyagaraj, the learned SDR for the department reiterated the grounds of appeal. H....

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....likewise. He therefore pleaded that reliance of the department on the decision reported in the case of Sunray Computers reported in 1988 (33) E.L.T. 787 is not correct and he sought for rejection of the department's appeal. 6. So far as the inclusion of element of freight and insurance is concerned, he fairly concedes that the position will have to be examined with reference to the terms of the contract whether the element of freight and insurance is included in the sale price in terms of the contract. 7. We have considered the pleas made by both the sides. We observe that it is not in dispute that hard disc drive the value of which is sought to be included in the value of the computer was supplied as a spare and there was a....

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..... The plea of the Revenue is that the value of disc drive should be taken into consideration for the purpose of duty in respect of the computer inasmuch as the same was being supplied as a part of the single contract. We observe that it is not the manner in which the product is contracted for which would be always relevant for the purpose of assessment. What has to be seen is whether the item being assessed is an identifiable item as understood in the trade for assessment purpose and whether that item in terms of the contract can be taken to be forming part of the main item. In the present case, it is not the plea of the Revenue that the disc drive supplied formed part of the computer. But the plea is that it will be used as part of the com....