TMI Blog2010 (9) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... only in the HSN Explanatory Notes goes to show that the said Heading was meant exclusively for that purpose alone and not otherwise. Software is the set of instructions that allows physical hardware to function and perform computations in a particular manner, be it a word processor, web browser or the computer's operating system. These expressions are in contrast with the concept of hardware which are the physical components of a computer system, and data, which is information that performs no computation and gives no enabling instructions to computer hardware but is ready for processing by the computer software. Therefore, such engineering drawings or designs data in a CD cannot be placed in the category of the term software . It is therefore held that the engineering drawings and designs contained in a CD ROM will not be covered Heading 85.24 of the Tariff. The classification of CD ROM containing images of drawing and designs of engineering goods - such engineering drawings and designs do not provide instructions for the computer hardware to perform. At best, the said drawings and designs can be said to be are by-products and outputs of the computer software, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or classifying the same under Sub-Heading Nos. 8524.39 or 8524.90 of the Tariff was also not accepted. Incidentally, the aforesaid stand taken by the CEGAT was by way of confirmation of the view taken by the Commissioner-Appeals. 3. The appellant herein filed a Bill of Entry No. 369686 dated 29.1.2002 for clearance of the goods at Nil rate of duty by claiming classification of the goods under the Tariff Heading 4906.00 read with Central Excise Tariff Heading 4901.90 coupled with the benefit of Nil rate of duty under Notification No. 17/2001 dated 1.3.2001. The import was made in the month of January, 2002 and the authorities were requested by the appellant to allow the clearance of the goods at Nil rate of duty. The Adjudicating Officer, however, decided the case against the appellant holding that the latter is not entitled to the aforesaid classification as claimed. The adjudicating authority recorded a finding that the imported goods are covered under Central Excise Tariff Heading 8524.90. 4. Being aggrieved by the said order, the appellant filed an appeal before the Commissioner of Customs (Appeals) Airport, Mumbai, which however came to be dismissed by order dated 15.11.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... producers, television image and sound recorders and reproducers, and parts and accessories of such articles 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. 8524.39 Other 8. Although certain, alternative arguments have been made as well, we would like to consider initially as to whether the goods in question could be said to be covered under the heading 49.06 or 49.11 in any manner. 9. Chapter 49 deals with printed books, newspapers, pictures and other products of the printing industry; manuscripts, typescripts and plans. Heading 49.06 covers within its fold plans and drawings for architectural, engineering, industrial, commercial, topographical or similar purposes, being originals drawn by hand; hand-written texts; photographic reproductions on sensitized paper and carbon copies of the foregoing. Heading 49.09 will cover drawing used for engineering or other similar purposes and hence will also cover within its ambit designs of engineering goods. The only caveat imposed by Heading 49.06 is that the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rpose alone and not otherwise. 12. In Collector of Central Excise, Shillong vs. Wood Crafts Products Ltd. reported in (1995) 3 SCC 454, it was held by this Court that as expressly stated in the statements of objects and reasons of the Central Excise Tariff Act, 1985, the Central Excise Tariffs are based on the Harmonious System of Nomenclature (HSN) and the internationally accepted nomenclature was taken into account to reduce disputes on account of tariff classification. Accordingly, for resolving any dispute relating to tariff classification, a safe guide is the internationally accepted nomenclature emerging from the Harmonious System of Nomenclature (HSN). Although, the decision in the case of Woodcraft Products (supra) dealt with the interpretation of the provisions of the Central Excise Tariff there can be no doubt that the HSN Explanatory Notes are a dependable guide even while interpreting the Customs Tariff. 13. The Counsel appearing for the appellant also urged that the said CD ROM could and would fall under Heading 49.11. Heading 49.11 covers within its compass "other printed matter, including printed pictures and photographs". Specific reliance was placed on 4911.99 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hapter or heading No. or sub heading No. " which is shown in the table as 49 or 85.24 and for which the description of goods are as follows:- "i. The following goods namely:- Information Technology software, and Document of title conveying the right to use Information Technology software. ii. Explanation iii. "Information Technology software" means any representation of instructions, data, sound or image including source code and object code, recorded in a machine readable form, and capable of being manipulated or providing interactivity to a user, by means of an automatic data processing machine." 17. Therefore, now the question which arises for consideration in this case is whether the disc in question, with designs and drawings of the engineering goods could be said to be information technology software, as was submitted by the counsel for the appellant. 18. The term software is defined by the Advanced Law Lexicon (3rd Ed.) as "distinct from hardware, the computer program enabling a computer to function". The same expression software is also defined in Britannica Concise Encyclopedia as "the entire set of programs, procedures and routines associated with the operatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... machine readable binary form and capable of being manipulated or providing interactivity to a user, by means of an automatic data processing machine. As stated earlier the Harmonious System of Nomenclature (HSN), which is a safe guide for classification, also supports such a view. 23. Reliance was placed by the learned counsel appearing for the appellant on the decision of Associated Cements Companies Ltd. vs. Commissioner of Customs reported in 2001 (128) ELT-21 (SC). The aforesaid is a decision of this Court wherein the issues urged were four which were specifically noted in paragraph 11 of the said judgment; "11. In these appeals, the learned counsel for the appellants urged four contentions which had been unsuccessfully raised before the Tribunal. These contentions were (i) Excise duty cannot be levied on the value of ideas as they are not goods; (ii) Even if what was imported were goods, the valuation of the same has to be nominal; (iii) the show cause notices were issued were barred by time inasmuch as the extended period of limitation of five years would not be available on the facts of the present case; (iv) the imports through the courier could not be governed by Headi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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