TaxTMI 
TaxTMI 
2008 (4) TMI 195
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.... of duty, as the case may be, during the period of dispute. In the Notification as amended on 9.7.2004, the term 'computer' was explained as under:- "Explanation:- For the purposes of this exemption, 'computer' shall include central processing unit (CPU) cleared separately; or CPU with monitor, mouse and key board, cleared together as a set; but shall not include input or output devices or accessories such as monitor, key board, mouse, modem, uninterrupted power supply system, or web camera cleared separately." In the impugned order, learned Commissioner found that (a) the subject goods were being sold as 'kiosks' and not as computers or computer peripherals; (b) special functional units such as Coin Validator, MICR (Magnetic Ink Character Reader), Bar Code Reader, Touch Screen, Printer, which were not found in normal computers, were incorporated in the kiosks; (c) the price of each kiosk was more than twice that of a normal computer; (d) the General Manager (Procurement), ELCOT, stated that the appellants' kiosk was different from a computer in construction, configuration and performance; and (e) an EDP Assistant of M/s. Chennai Silks also stated that it was not a computer b....
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....ch accessories (Coin Validator, MICR etc.) as required by customer, housed in a metal sheet casing. It has a touch-screen monitor instead of a normal monitor. Input signals are received through human touch in the screen of the monitor itself, which are converted into digital signals and transmitted to CPU for processing. By directly receiving input data, the touch-screen monitor acts as an input unit and, by converting the signals provided by the CPU into a visual display, the monitor also acts as an output unit. Thus the kiosk houses input, processing/storing and output units as in a computer. A keyboard and mouse have also been provided to be used for change of programmes. Learned counsel has narrated these features of the kiosk and has submitted that the machine is nothing but a computer customized to meet the specific requirements of customers including Govt. agencies. In this connection, he has referred to the manufacturer's catalogue also. Like any other computer, the kiosk is equipped with necessary operating systems. A customer who places order for a kiosk is also required to place order for operating system like 'MS Windows'. The computer in the kiosk can also be included ....
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....short question before us is whether the ADP machines of Heading 84.71 can be called 'computers'. The Central Board of Excise & Customs called them 'computers' long ago vide Circular No. 454/20/99-CX dated 12.4.1999. 7. We find that the kiosk in question answers the features of computer given in the dictionary cited by SDR. The dictionary provides the following information on 'computer';- "Computer: A device by which data, represented in an appropriate form, can be manipulated in such a way as to produce a solution to some problem. It is able to perform a substantial amount of computation with little or no human assistance. In general when the word computer is used by itself it refers to a digital computer. The other basic form of computer is the ANALOG COMPUTER, which is far less versatile and thus finds fewer more specialist applications. A digital computer accepts and performs operations on discrete data, i.e. data represented in the form of combinations of CHARACTERS. Before being fed into the computer the characters consist of digits, letters, punctuation marks etc. Inside the computer all these characters are in binary form, encoded as combinations of binary digits, o....
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..... The monitor acts as output unit also. HSN Notes also say that input and output units may be combined in one single unit. That the kiosk contains a central processing unit (CPU) capable of storing and processing data is also a fact recognized by the Commissioner, who has accepted the factual position that an ADP machine is housed in the kiosk. We have found this machine to be a customized version of computer. In this context, it is pertinent to recollect that CBEC had noted long ago (Circular No. 454/20/99-CX ibid) that Heading No. 84.71 of the CETA Schedule described computers as ADP machines. In the impugned order, learned Commissioner has not disclosed any rationale underlying his proposition that "………… all ADP machines are not computers". 8. The appellants' catalogue on kiosks designed for a variety of purposes is available on record and the same, for instance, contains the following information on "HCL Bee Jupiter Kiosks":- "The HCL Bee Jupiter kiosk is designed for extremely rugged and it can be placed in any Environment. We are proud to introduce this model, packed with Coin Validation Machines. It validates the coin and allows the user to access the system. ....
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....iosk was different from a computer in construction, configuration and performance. The dictionary referred to by SDR also says that computers range widely in performance, size and cost. In our assessment, the ELCOT expert did not mean to say that the kiosk did not house a computer as understood in technological parlance. It is common knowledge that information technology is a fast-developing phenomenon and the commoners in our country are yet to keep pace with it. Common parlance is, therefore, likely to lag behind technological parlance. Those associated with the technology, manufacture and marketing of the kiosks - like the appellants and the ELCOT functionary will identify these machines today as computers customized for special purposes, but the laymen may take some more time to do so. Therefore, in our considered view, the Commissioner applied the common parlance test inappropriately to the kiosks in question. He ought to have gone by the Explanation to the Notification, which explained the term 'computer', rather than by common parlance. 10. Learned SDR has cited a few decisions of the Supreme Court to support the Commissioner's reliance on common parlance. In the case of ....