Valuation of Computer Systems sold along with software - clarifications - regarding.

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....tion of computer systems sold along with software. The software can be of two types. One is the 'systems software' or 'operating software' which is designed to control the operation of the computer system. The other software is the application software which is developed for specified applications only. There is also a third category of software, called the "firm software" or "basic software" whic....

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....e this aspect had already been accepted by the appellants i.e. PSI Data Systems Ltd. (reference paras 2 & 11 of the judgment). However, by implication it can be said that the Supreme Court approved the inclusion of the etched software in the value of the computer system (the Head Notes of this judgement brought out in the above citation does not bring out the gist of the judgement correctly as the....

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.... system. No distinction should be made between an 'operating software' or an 'application software' in this regard. If the computer is sold loaded with a software, the value of the software will be included in the value of the computer. Any floppy, disc or tape containing any software supplied along with the computer system will, however, be assessed separately. 4. The introduction of the "tran....