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2013 (4) TMI 220 - AT - Central ExciseValuation - inclusion of cost of software in the value hardware - Customized software - manufacture and supply of Digital Loop Carriers (DLC) - supply of Hardware and also the operating software and spare parts - Appellant are of the opinion that the value of the software supplied by them cannot be charged to Central Excise as held by the Hon'ble Supreme Court in the case of PSI Data Systems Ltd. Vs. Collector of Central Excise [1996 (12) TMI 47 - SUPREME COURT OF INDIA], wherein, it was held that the value of computers will not include the value of the software supplied in the form of floppies, discs, tapes, along with the computer. Held that - the dispute arose consequent to an objection raised after audit of the appellants' unit. DLC equipments manufactured by the appellants were supplied to BEL who in turn supplied to MTNL. When the equipments were received by MTNL, the software was loaded into the equipments and testing completed. It is the consistent stand of the appellant that the equipments have been cleared from the factory without the software being loaded in the equipments. No evidence is relied upon by the department to disprove this claim. The impugned software is no doubt customized software usable only with the DLCs. However, the DLCs do not become dysfunctional without the impugned software as they can be used as 2W type of DLC. In view of the above, the appellants claiming separate classification of the impugned software under Chapter subheading 8524 and clearing the said software without payment of duty is in order. There is no justification for including value of such software in the value of DLC equipments. - Decided in favor of assessee.
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