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2004 (2) TMI 72 - SC - Central ExciseValuation (Central Excise) - Computer software - Held that:- Any amount which a buyer has to pay "by reason of or in connection with the sale" is part of the transaction value. There are softwares without which computer cannot work at all. There may be softwares which contain additional or ancillary applications which a customer may want to buy separately. An additional or ancillary application would, of course, be classifiable separately and cannot be included in the value of a computer. But a buyer has to buy software without which the computer cannot work. The computer would otherwise be a dead box, if software, without which the computer cannot work, is not purchased. When one talks of a computer, as understood in the trade, it is not just the box or the hardware. A computer contains of both hardware and the operating software. The price of such softwares is thus the amount which a buyer is bound to pay by reason of or in connection with the sale of computers. It appears to us that the price of such software is thus includable in the value for purposes of excise duty. We, therefore, feel that the matter requires reference to a Larger Bench - decided in favour of Revenue.
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