TaxTMI 
TaxTMI 
2003 (5) TMI 110
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....he Commissioner (Appeals), accepted the proposal in the notice demanding duty consequentially required. The Assistant Commissioner's order imposing penalty has been set aside by the Commissioner (Appeals). Hence this appeal. 1. Heading 85.24 and the relevant sub-headings, as this stood at the relevant time, are reproduced below :- Heading No. sub-heading No. Description of goods 85.24 Records, tapes and other recorded media for sound or other similarly recorded phenomena, including matrices and masters for the production of records, but excluding products of Chapter 37 8524.10 - Gramophone records 8524.20 - Software Magnetic tapes 8524.31 -- Audio tapes in any form 8524.3....
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....e process that the appellant adopts for the manufacture of its recorded compact disc, by employing the stamper which impresses by means of each the data is impressed upon the material which dispute the compact disc is not dissimilar to the manufacture of gramophone records using the material made out of the master records. Therefore, it is completely irrelevant whether the appellant manufactured the recorded media directly, or by first taking the unrecorded discs and thereafter imprint the data upon it. 5. The Deputy Commissioner proceeds to decide the issue by application of what is called "universal law." He notes that compact disc containing software can be obtained by one of two manners, either by recording the data on a blank compact ....
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....is accepted, as the Deputy Commissioner does, that software recorded on to an existing unrecorded compact disc renders that disc an item of software it would necessarily to follow that the software recorded directly in the course of manufacture of the compact disc is also an item of software. 7. The appeal would have to be allowed on another ground too. Prior to 1996, there was no separate sub-heading in Heading 85.24 specifically for software. In 1996, a sub-heading 20 was introduced covering "computer software". The appellants had cited before the Commissioner (Appeals) the Board's circular 7/98, dated 12-2-98. This circular explained that the term "computer software" figuring in entry 173 of Notification 11/97, which exempted it from cu....
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....d that the appellant manufactured, which stands on the same footing should be treated differently. In the absence of any definition of software in the tariff heading, it would be appropriate to apply the definition contained in the Notification No. 11/97 issued under the Customs Act, 1962. 9. It is not possible to accept the Commissioner (Appeals) view that the software in question is not interactive. The difference between the interactive software and other software is clearly explained in Dictionary of Computer Terms, Third Edition as under : Batch Processing : In batch processing the user gives the computer a 'batch' of information, referred to as a job for example, a program and its input data on punched cards and waits for it to be p....