TaxTMI 
TaxTMI 
2018 (4) TMI 1308
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....the manufacture of Distributed Control System (DCS). The appellants were recovering through separate invoices on amounts under the head of "Project Management Services, Design and Software Development Services and Design Engineering Services. Ld. Counsel argued that all these heads related to development of Software for use specific to the purchasers of the DCS manufactured by them. Ld.Counsel pointed out that in the assessable value of DCS. They are already including the value of bought-out items supplied along with DCS and also the software built into DCS. Ld. Counsel pointed out that the present dispute relates to the optional software which are supplied made for the customer. The customers are free to source these software from anywhere....
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....ssued. He further argued that penalty under Section 11AB and 11AC come into statute from the year 1996and most of the period under demand pertains to the period prior to the introduction of Section 11AB and Section 11AC in this statute. 3. Ld. AR relies on the impugned order. He further pointed out that the appellants were recovering these charges in the shape of supplementary invoices and the same were not produced to the department. He further pointed out that valuation report issued by Anmol Sekhri & Associates Pvt. Ltd. is a concoct report as various place report uses the word 'us' and 'our' which clearly shows that the said Chartered Engineer has merely signed on the doubted line on the text provide by the appellant. He argued that ....
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....aid case was as follows:" 11. Learned Counsel for the respondent, fairly, did not dispute that the value of the software that the appellants might sell with their computers, if so ordered by the purchasers thereof, could not be included in the assessable value of the computers. He was, however, at pains to urge that this did not apply to the firm software that was etched into the computer; this is not even the appellants' case. 13 .Secondly, that a computer and its software are distinct and separate is clear, both as a matter of commercial parlance as also upon the material on record. A computer may not be capable of effective functioning unless loaded with software such as discs, floppies and C.D. rhoms, but that is....
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....r may not be capable of effective functioning unless loaded with softwares, the same would not tantamount to bringing them within the purview of the part of the computer so as to hold that if they are sold along with the computer their value must form part of the assessable value thereof for the purpose of excise duty. Both computer and software must be classified having fallen under 84.71 and 85.24 and must be subject to corresponding rates of duties separately. The informations contained in a software although are loaded in the hard disc, the operational software does not lose its value and is still marketable as a separate commodity. It does not lose its character as a tangible goods being of the nature of CD-ROM.A licence to use the inf....
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....not so excisable. Section 3 of the Act being the charging section, the definition of 'transaction value' must be read in the text and context thereof and not de 'hors the same. The legal text contained in Chapter 84, as explained in Chapter Note 6, clearly states that a software, even if contained in a hardware, does not lose its character as such. When an exemption has been granted from levy of any excise duty on software whether it is operating software or application software in terms of heading 85.24, no excise duty can be levied thereupon indirectly as it Wasim permissible to levy a tax indirectly. In that view of the matter the decision in PSI Data Systems (supra) must be held to have correctly been rendered". This decision of Hon'....