{"id":143026,"date":"2004-09-24T00:00:00","date_gmt":"2004-09-23T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004"},"modified":"2018-08-09T11:26:59","modified_gmt":"2018-08-09T05:56:59","slug":"commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004","title":{"rendered":"Commnr. Of Central Excise, … vs M\/S. Acer India Ltd on 24 September, 2004"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Commnr. Of Central Excise, … vs M\/S. Acer India Ltd on 24 September, 2004<\/div>\n
Author: S.B. Sinha<\/div>\n
Bench: N. Santosh Hegde, S.B. Sinha, Tarun Chatterje<\/div>\n
           CASE NO.:\nAppeal (civil)  10185-10186 of 2003\n\nPETITIONER:\nCommnr. Of Central Excise, Pondicherry\t\t\t\n\nRESPONDENT:\nM\/s. ACER India Ltd.\t\t\t\t\t\t\n\nDATE OF JUDGMENT: 24\/09\/2004\n\nBENCH:\nN. Santosh Hegde,S.B. Sinha & Tarun Chatterje\n\nJUDGMENT:\n<\/pre>\n
J U D G M E N T<\/p>\n
With C.A. Nos. 1148-1149 of 2004 &
\nI.A. Nos. 3-4\/2004<\/p>\n
S.B. SINHA, J:\n<\/p>\n
 \tThe Revenue is in appeal before us being aggrieved by and
\ndissatisfied with the judgment and order dated 29.08.2003 passed by the
\nCustoms, Excise and Service Tax Appellate Tribunal, South Zonal Bench,
\nBangalore whereby and whereunder the appeal filed by the Respondent
\nherein from an order passed by the Commissioner of Central Excise,
\nPondicherry dated 27.1.2003 was allowed holding that no central excise duty
\nis payable on a software loaded in a hardware, i.e., computer.\n<\/p>\n
FACTS:\n<\/p>\n
 \tThe Respondent is a company manufacturing computers, peripherals,
\nservers, note books and accessories falling under different headings of
\nChapter 84 of the Schedule appended to the Central Excise Tariff Act, 1985.
\nUpon a licence obtained by WIPRO, the Respondent, on orders received
\nfrom the customers load operational softwares. While calculating the amount
\nof central excise payable thereupon, it would deduct the value of the
\noperational softwares from the total value of the computer supplied to the
\ncustomers.  The revenue objected to the said procedure on the premise that
\nexcise duty is payable on the entire value of the computer including the
\nvalue of operational softwares.\n<\/p>\n
 \tA show cause notice dated 8.8.2002 was issued by the Superintendent
\nof Central Excise for the period July 2001 to May, 2002 asking it to show
\ncause as to why it would not be called upon to pay the differential duty of
\nRs. 48,65,003\/-.\n<\/p>\n
 \tYet again a show cause notice was issued on 19.8.2002 demanding a
\ndifferential duty of Rs. 54,90,700\/- for the period 1.7.2000 to 30.6.2001 by
\nthe Commissioner of Central Excise, Trichy purported to be in terms of the
\nproviso appended to Section 11A (1) of the Central Excise Act, 1944.  The
\nrespondent pursuant to the said notices filed their show causes.\n<\/p>\n
The Commissioner of Central Excise by an order dated 27.1.2003
\ndirected payment of the differential duty specified in the two show cause
\nnotices and further levied interest thereupon as also penalty holding:\n<\/p>\n
“i) That the value\/cost of the operational software
\ninstalled by the assessee on the computers before
\nclearance from the factory is includible in the
\nassessable value\/ transaction value of the computer
\nsystem and therefore the differential duty
\ndemanded in the two show cause notices need to
\nbe confirmed.\n<\/p>\n
ii) That there were justifying grounds and
\nevidences for the invocation of the proviso to
\nSection 11A (1) in the present case besides
\nimposition of penalty..”\n<\/p>\n
 \tIt was further held that the loading of operational software in the
\nfactory would come within the mischief of ‘transaction value’ of the
\ncomputer in terms of Section 4 of the Central Excise Act, 1944 with effect
\nfrom 1.4.2000 having regard to the expressions “by reason of sale” or “in
\nconnection with the sale” as contained in the definition thereof.\n<\/p>\n
 \tThe Respondent preferred an appeal thereagainst before the Tribunal
\nwhich by reason of the impugned judgment dated 29.8.2003 was allowed.
\nThe Tribunal passed the said judgment relying on or on the basis of a
\ndecision of this Court in PSI Data Systems Ltd. Vs. Collector of Central
\nExcise [1997 (89) ELT 3 (SC) : (1997) 2 SCC 78].\n<\/p>\n
 \tA Division Bench of this Court in its order dated 27.02.2004 doubted
\nthe correctness of the said decision opining that  as a computer would not
\nfunction without an operational software, the latter  would form a part of the
\nformer and, thus, excise duty would be payable on the total value thereof.
\nDistinguishing between softwares without which a computer cannot work
\nand those containing additional or ancillary applications and which a
\ncustomer may want to buy separately, the Bench observed:\n<\/p>\n
“But a buyer has to buy software without which
\nthe computer cannot work.  The computer would
\notherwise be a dead box, if software, without
\nwhich the computer cannot work, is not purchased.
\nWhen one talks of a computer, as understood in the
\ntrade, it is not just the box or the hardware.  A
\ncomputer contains of both hardware and the
\noperating software.  The price of such softwares is
\nthus the amount which a buyer is bound to pay by
\nreason of or in connection with the sale of
\ncomputers.  It appears to us that the price of such
\nsoftware is thus includable in the value for
\npurposes of excise duty.”\n<\/p>\n
 \tThe matter was,  thus, referred to a larger Bench.\n<\/p>\n
SUBMISSIONS:\n<\/p>\n
 \tMr. A. Subba Rao, learned counsel appearing on behalf of the
\nAppellant would contend that an operational software implanted in a
\nhardware becomes a part thereof and as such central excise duty is leviable
\non the  total value of the computer.  Drawing our attention to the provisions
\nof Section 4 of the Central Excise Act, 1944 (The Act) and in particular the
\ndefinition of “Transaction Value” as contained in Clause (d) of Sub-Section
\n(3) of Section 4 thereof, the learned counsel would submit that the same
\nwould include the value of all manufactured goods charged as price
\nincluding any amount that the buyer is liable to pay by reason of or in
\nconnection with the sale together therewith any other amount which adds to
\nthe value thereof.  As a software implanted is a part of the computer, it was
\nurged, excise duty would be payable on the total value thereof.\n<\/p>\n
 \tMr. Subba Rao would submit that a bare perusal of the judgment of
\nthis Court in PSI Data Systems Ltd. (supra) would indicate that therein this
\nCourt was not concerned with any software, which was implanted into a
\ncomputer and was only concerned with a software which is a tangible one
\nbeing of the nature of discs, floppies and CD-ROMs.  It was also not
\nconcerned with intellectual property also called software, that is recorded or
\nstored thereon.\n<\/p>\n
 \tA software which is implanted with a licence to right to use the
\ninformations contained therein, Mr. Subba Rao would argue, should not be
\ncompared with a disc, floppy or CD-ROM which is available in the market
\nseparately.\n<\/p>\n
 \tDrawing our attention to the findings of fact arrived at by the
\nCommissioner of Central Excise, the learned Counsel would submit that not
\nonly the operational softwares like Windows 98 OS or W2K are implanted
\nin the computers by the Respondent but as would appear from the price list
\nfurnished by it the configurations of different models of computers including
\noperational software are also quoted therein.  Furthermore, the Respondent
\nwas also being under an obligation to preload a software on the computer
\nbefore clearing the same from the factory, the central excise duty would be
\npayable on the entire value thereof.\n<\/p>\n
 \tMr. V. Lakshmikumaran, learned counsel appearing on behalf of the
\nRespondent, on the other hand, would submit that a computer which is a
\nhardware is marketable as such  containing a firm or etched software being
\nimplanted therein,  the valuation thereof also is taken into consideration for
\nthe purpose of excise duty but the operational softwares which are implanted
\non  specific orders placed by the customers would retain the characteristics
\nof software and would not lose its identity only because the informations
\ncontained therein together with the right to use the same is implanted in the
\ncomputer itself.  A computer may have different systems, Mr.
\nLakshmikumaran would contend, containing parallel or sequential process
\nwhich would make a computer system complete and the same should not be
\nconfused with a mere hardware.\n<\/p>\n
 \tThe learned counsel would argue that the hardwares and softwares are
\nclassified differently under different Headings, viz., 84.71 and 85.24 of the
\nCustoms Tariff Act.  Whereas in respect of the computers the rate of duty is
\n16%, for softwares the same is nil and, thus, the assessee was entitled to
\nclaim deduction of the value thereof from the total value of the computer.  It
\nwas argued that as both the hardware and the software are assessed
\nseparately, keeping in view Chapter Note 6 of Chapter 85, which contains  a
\nlegal text, the valuation of a computer and software cannot be clubbed
\ntogether for the purpose of assessment of excise duty.\n<\/p>\n
 \tMr. Dushyant Dave, learned senior counsel appearing on behalf of the
\nintervenor, supplemented the submissions of Mr. Lakshmikumaran
\ncontending that the value of the goods which would be subject matter of
\ncentral excise cannot be enhanced by implanting a software as it retains its
\nown character irrespective of the fact that the informations contained therein
\nare loaded in the computer itself.\n<\/p>\n
 \tThe learned counsel would argue that the value of the goods may be
\nenhanced in terms of the definition of the “Transaction Value” but the
\nexplanation contained therein must be read in the context of the main
\nprovision, viz., Section 4(1) and not de’hors the same.\n<\/p>\n
RELEVANT STATUTORY PROVISIONS:\n<\/p>\n
Central Excise Act, 1994:\n<\/p>\n
“2(d) “excisable goods” means goods specified in the
\nFirst Schedule and the Second Schedule to the Central
\nExcise Tariff Act, 1985 (5 of 1986) as being subject to a
\nduty of excise and includes salt;\n<\/p>\n
3. Duties specified in the Schedule to the Central
\nExcise Tariff Act, 1985 to be levied. (1) There shall be
\nlevied and collected in such manner as may be
\nprescribed,-\n<\/p>\n
(a) a duty of excise, to be called the Central Value Added
\nTax (CENVAT) on all excisable goods which are
\nproduced or manufactured in India as, and at the rates, set
\nforth in the First Schedule to the Central Excise Tariff
\nAct, 1985 (5 of 1986) :\n<\/p>\n
4 Valuation of excisable goods for purposes of
\ncharging of duty of excise. (1) Where under this Act, the
\nduty of excise is chargeable on any excisable goods with
\nreference to their value, then, on each removal of the
\ngoods, such value shall-\n<\/p>\n
(a) in a case where the goods are sold by the assessee, for
\ndelivery at the time and place of the removal, the
\nassessee and the buyer of goods are not related and the
\nprice is the sole consideration for the sale, be the
\ntransaction value;\n<\/p>\n
\n\t\t(3) for the purposes of this section, –\n<\/p>\n
(d) “transaction value” means the price actually paid or
\npayable for the goods, when sold, and includes in
\naddition to the amount charged as price, any amount that
\nthe buyer is liable to pay to, or on behalf of, the assessee,
\nby reason of, or in connection with the sale, whether
\npayable at the time of the sale or at any other time,
\nincluding, but not limited to, any amount charged for, or
\nto make provision for, advertising or publicity, marketing
\nand selling organization expenses, storage, outward
\nhandling, servicing, warranty, commission or any other
\nmatter; but does not include the amount of duty of excise,
\nsales tax and other taxes, if any, actually paid or actually
\npayable on such goods.”\n<\/p>\n
A COMPUTER:\n<\/p>\n
\tBefore adverting to consider the rival submissions at the bar, we may
\nnotice the meaning of certain terms as also the functioning of a computer.\n<\/p>\n
 \tIn Newton’s Telecom Dictionary, “Application Program” has been
\ndefined at page 54 as under:\n<\/p>\n
“A computer software program designed for a
\nspecific job, such as word processing, accounting,
\nspreadsheet, etc.”\n<\/p>\n
 \tIn the said dictionary, “Firmware” has been defined at pages 281-282
\nas under:\n<\/p>\n
“Software kept in semipermanent memory.\n<\/p>\n
Firmware is used in conjunction with hardware
\nand software.  It also shares the characteristics of
\nboth.  Firmware is usually stored on PROMS
\n(Programmable Read only Memory) or EPROMs
\n(Electrical PROMS).  Firmware contains software
\nwhich is so constantly called upon by a computer
\nor phone system that it is “burned” into a chip,
\nthereby becoming firmware.  The computer
\nprogram is written into the PROM electrically at
\nhigher than usual voltage, causing the bits to
\n“retain” the pattern as it is “burned in”.  Firmware
\nis nonvolatile.  It will not be “forgotten” when the
\npower is shut off.  Handheld calculators contain
\nfirmware with the instructions for doing their
\nvarious mathematical operations.  Firmware
\nprograms can be altered.  An EPROM is typically
\nerased using intense ultraviolet light.”\n<\/p>\n
 \t“Operating system” has been defined at page 500 of the said
\ndictionary as under:\n<\/p>\n
“A software program which manages the basic
\noperations of a computer system.  It figures how
\nthe computer main memory will be apportioned,
\nhow and in what order it will handle tasks assigned
\nto it, how it will manage the flow of information
\ninto and out of the main processor, how it will get
\nmaterial to the printer for printing, to the screen for
\nviewing, how it will receive information from the
\nkeyboard, etc.  In short, the operating system
\nhandles the computer’s basic housekeeping MS-
\nDOS, UNIX, PICK, etc, are operating systems.”\n<\/p>\n
\tThus, there are different operating systems.\n<\/p>\n
Computers of various models and types with different configurations
\nincluding Servers and Personal Computers are manufactured by the
\nRespondent.  They are classifiable under Chapter Sub-heading 8471.00 of
\nthe Central Excise Tariff Act, 1985 (Tariff Act) as automatic data processing
\nmachines.\n<\/p>\n
 \tIn the computers  there exists a flash memory chip in the
\nmotherboard.  The software that is essential to the starting of the computer
\nwhich is the Basic Input Output Software is etched on to this memory chip.
\nThis Basic Input Output Software which is etched or burnt into the
\nElectrically Erasable Programmable Read Only Memory (EEPROM) is
\ncalled firmware.  The firmware provides for interactions with the
\nmicroprocessor to enable it to access the operating software contained in the
\nhard disc.\n<\/p>\n
 \tAs is the general practice in the computer industry, the value of the
\nfirmware etched on to the EEPROM is always included in the assessable
\nvalue of the computers.\n<\/p>\n
 \tA customer may place a specific order upon the manufacturers of
\ncomputers for supply of CDs which contain operating softwares like
\nWindows 2000, Windows XP etc. as also the right to use the same under
\nlicence.  The said softwares indisputably can be purchased separately and
\nloaded in the computer by the purchasers themselves.  They can be loaded
\neven at the premises of the purchasers and by persons other than the
\nmanufacturers. The computers, however, are also loaded with different types
\nof softwares on to the hard disc along with licence to use, if and when
\nspecifically ordered by the customers.  Computers and operational softwares
\nadmittedly are available in the market separately.  For the purpose of this
\ncase, however, we would proceed on the premise that all the computers are
\ncleared with the softwares loaded onto the hard disks and with the CDs
\ncontaining the softwares along with the licence to use.\n<\/p>\n
 \tThe invoice-cum-challan issued by the assessee contains the total
\nvalue of the computer but therefrom value of the operating softwares is
\ndeducted for the purpose of computing the central excise duty payable
\nthereupon.\n<\/p>\n
PRINCIPLES OF INTERPRETATION OF A TAXING\/FISCAL
\nSTATUTE:\n<\/p>\n
A duty of excise primarily is levied upon a manufacturer or producer
\nin respect of the commodity manufactured or produced.  It is a tax upon
\ngoods and not upon sales or the proceeds of sale of goods.  In terms of Entry
\n84, List I of the Seventh Schedule of Constitution of India, the taxable event
\nin respect of the duty of excise is the manufacture or production.  No tax in
\nterms of Article 265 of the Constitution of India can be imposed, levied or
\ncollected except by the authority of law.\n<\/p>\n
 \tIn Cape Brandy Syndicate Vs. Inland Revenue Commissioners,
\n[(1921) 1 KB 64 at p. 71], it is stated:\n<\/p>\n
“In a taxing Act one has to look merely at
\nwhat is clearly said.  There is no room for any
\nintendment.  There is no equity about a tax.\n<\/p>\n
There is no presumption as to tax.  Nothing is to
\nbe read in, nothing is to be implied.  One can
\nonly look fairly at the language used.”\n<\/p>\n
[See also State of West Bengal Vs. Kesoram Industries Ltd. and Ors, 2004
\n(1) SCALE 425].\n<\/p>\n
 \tIt is also well-known that the one and the only proper test in
\ninterpreting a section in a taxing statute would be that the question is not at
\nwhat transaction the section is according to some alleged general purpose
\naimed, but what transaction its language according to its natural meaning
\nfairly and squarely hits. [See St. Aubyn (LM) and Others Vs. Attorney
\nGeneral (No. 2), (1951) 2 All ER 473, p. 485]
\n \tImposition of tax is a constitutional function.
\n \tA taxing or a fiscal statute demands strict construction.  It must never
\nbe stretched against a tax payer.  So long natural meaning for the charging
\nsection is adhered to and when the law is certain, then a strange meaning
\nthereto should not be given. [See W.M. Cory & Sons Ltd. Vs. Inland
\nRevenue Commissioners, (1965) 1 All ER 917]
\n \tIt is also well-settled rule of construction of a charging section that
\nbefore taxing a person it must be shown that he falls within the ambit thereof
\nby clear words used as no one can be taxed by implication.
\n \tIt is further well-settled that a transaction in a fiscal legislation cannot
\nbe taxed only on any doctrine of “the substance of the matter”  as
\ndistinguished from its legal signification, for a subject is not liable to tax on
\nsupposed “spirit of the law” or “by inference or by analogy”.
\n \tThe taxing authorities cannot ignore the legal character of the
\ntransaction and tax it on the basis of what may be called ‘substance of the
\nmatter’.  One must find the true nature of the transaction.  [See Union of
\nIndia and Others Vs. Play World Electronics Pvt. Ltd and Another., (1989) 3
\nSCC 181]
\n \tWhile interpreting valuation or classification contained in the Tariff
\nAct, one cannot lose sight of the legal text contained in the Chapter Note
\nexplaining the meaning of the entry and in absence of its applicability
\nthereto the general rules of interpretation.
\n \tThe entries in the instant case are covered by the Chapter Note 6 vis-
\n`-vis Rule 1 of the general rules of interpretation and Rule 3 thereof.
\n \tWhile construing a taxing statute, the existing market practice may
\nalso be taken into consideration.\n<\/p>\n
 \tThe statute, however, should not be interpreted in such a manner
\nwhich may lead to wide scale evasion of duty.  The Court should adopt an
\ninterpretation which would be user friendly.  If any other interpretation is
\nmade, the same would encourage the manufacturers to sell the operational
\ncomputer separately as a result of which the buyers may have to incur extra
\ncharges.  The customers, thus, may not be able to get the benefit of the
\ninformation contained in the operational computer loaded in the factory.
\nFurthermore, it may encourage in loading of pirated softwares in the
\ncomputer.\n<\/p>\n
In Mathuram Agrawal Vs. State of Madhya Pradesh [(1999) 8 SCC
\n667], the law is stated in the following terms:
\n“…The intention of the legislature in a taxation
\nstatute is to be gathered from the language of the
\nprovisions particularly where the language is plain
\nand unambiguous.  In a taxing Act it is not
\npossible to assume any intention or governing
\npurpose of the statute more than what is stated in
\nthe plain language.  It is not the economic results
\nsought to be obtained by making the provision
\nwhich is relevant in interpreting a fiscal statute.
\nEqually impermissible is an interpretation which
\ndoes not follow from the plain, unambiguous
\nlanguage of the statute.  Words cannot be added to
\nor substituted so as to give a meaning to the statute
\nwhich will serve the spirit and intention of the
\nlegislature.  The statute should clearly and
\nunambiguously convey the three components of
\nthe tax law i.e. the subject of the tax, the person
\nwho is liable to pay the tax and the rate at which
\nthe tax is to be paid.  If there is any ambiguity
\nregarding any of these ingredients in a taxation
\nstatute then there is no tax in law.  Then it is for
\nthe legislature to do the needful in the matter.”\n<\/p>\n
\t\t\t\t\t\t(Emphasis Supplied)
\n [See also Indian Banks’ Association, Bombay and Ors. Vs. M\/s. Devkala
\nConsultancy Services and Ors., JT 2004 (4) SC 587]
\n \tIn Hansraj and Sons Vs. State of Jammu and Kashmir and Others
\n[AIR 2002 SC 2692 : (2002) 6 SCC 227] rule of strict construction of a
\ntaxing statute was recommended.\n<\/p>\n
We are also not oblivious of the fact that when the statutory provision
\nis reasonably akin to only one meaning, the principle of strict constructions
\nmay not be adhered to.\n<\/p>\n
 \tArtificial rules to give the tax payer the ‘breaks’ are not out of place
\nfor taxation is now not an ‘impertinent intrusion into sacred rights of private
\nproperty’. [See  Oxford University Press Vs. Commissioner of Income-tax,
\n(2001) 3 SCC 359]<\/p>\n
 \tFurthermore, for the purpose of interpretation of a taxing statute, the
\nfiscal philosophy, a feel of which is necessary to gather the intent and effect
\nof its different clauses should be applied.  [See K.P. Verghese Vs. Income
\nTax Officer, Ernakulam and Another, (1981) 4 SCC 173].\n<\/p>\n
A consideration of public policy may also be relevant in interpreting
\nand applying a taxing Act. [See Maddi Venkatraman & Co. (P) Ltd. Vs.
\nCommissioner of Income Tax, (1998) 2 SCC 95].\n<\/p>\n
 \tA provision enacted for the benefit of an assessee should be so
\nconstrued which enables the assessee to get its benefit.  [See Mysore
\nMinerals Ltd., M.G. Road, Bangalore Vs. The Commissioner of Income
\nTax, Karnataka, Bangalore (1999) 7 SCC 106]
\n\tHowever, principle of purposive construction will be adhered to when
\na literal meaning may result in absurdity.\n<\/p>\n
 \tIn Francis Bennion’s Statutory Interpretation, Fourth Edition, page
\n828, it is stated:\n<\/p>\n
“Section 310. Purposive construction not excluded
\nfor taxing etc. Acts: Particular types of Acts (for
\nexample taxing Acts) are not excluded from
\nstrained and purposive construction.  The
\npresumption as to purposive construction applies
\nto them as to other Acts.”\n<\/p>\n
 \tWe may also notice that in Francis Bennion’s Statutory Interpretation,
\nFourth edition at pages 879-880, the maxim ‘quando aliquid prohibetur fieri,
\nprohibitur ex directo et per obliquum’ has been quoted which means
\n“Whenever a thing is prohibited, it is prohibited whether done directly or
\nindirectly.”\n<\/p>\n
\tWith the aforementioned principles in mind, answers to the questions
\ninvolved in these matters are required to be found out.\n<\/p>\n
INTERPRETATION OF THE RELEVANT PROVISIONS:\n<\/p>\n
Section 2(d) of Central Excise Act, 1944 defines the “excisable
\ngoods” to mean the goods specified in the First Schedule and the Second
\nSchedule to the Central Excise Tariff Act, 1985 as being subject to a duty of
\nexcise.  It must, therefore,  be  ‘goods’ which would be subject to a duty of
\nexcise and not  the ‘goods’ which would  not be.\n<\/p>\n
 \tSection 3 thereof is the charging provision.  It not only lays down the
\nmode and manner for levy and collection of central excise duty but in no
\nuncertain terms states that a duty of excise shall be levied on all excisable
\ngoods which are produced or manufactured in India, as, and at the rates, set
\nforth in the Tariff Act.\n<\/p>\n
 \tSection 4 provides for the manner in which an enquiry is required to
\nbe made for valuation of goods for the purpose of levy of excise duty on
\n“goods”.  In terms of Clause (a) of Sub-section (1) of Section 4 when the
\nduty of excise is chargeable on the concerned excisable goods with reference
\nto their value, the same shall be calculated in the manner laid down therein.\n<\/p>\n
 \tIt may be true that the definition of “Transaction Value” which is
\nincorporated in Clause (d) of Sub-section (3) of Section 4 for the purpose of
\nsaid Section states that the price actually paid or payable for the goods, when
\nsold, would include in addition to the amount charged as price, any amount
\nthat the buyer is liable to pay to, or on behalf of, the assessee, by reason of,
\nor in connection with the sale.  Only because the expressions “by reason of,
\nor in connection with the sale” have been used in the definition of
\n“Transaction Value”, the same by itself would not take away the rigours of
\nSub-section (1) of Section 4 as also the requirement of charging section as
\ncontained in Section 3.\n<\/p>\n
 \tIt must be borne in mind that central excise duty cannot be equated
\nwith sales tax.  They have different connotations and apply in different
\nsituations.  Central excise duty is chargeable on the excisable goods and not
\non the goods which are not excisable.  Thus, a ‘goods’ which is not
\nexcisable if transplanted into a goods which is excisable would not together
\nmake the same excisable goods so as to make the assessee liable to pay
\nexcise duty on the combined value of both.  Excise duty, in other words,
\nwould be leviable only on the goods which answer the definition of
\n“excisable goods” and satisfy the requirement of Section 3.  A machinery
\nprovision contained in Section 4 and that too the explanation contained
\ntherein by way of definition of ‘transaction value’ can neither override the
\ncharging provision nor by reason thereof a ‘goods’ which is not excisable
\nwould become an excisable one  only because one is fitted into the other,
\nunless the context otherwise requires.\n<\/p>\n
 \tIt is not a case where the software is being supplied to the customer
\nalong with the computer by way of incentive or gift.  The Respondent is
\ncharging the price therefor.  Software therefor along with a computer is
\nbeing sold both in the form of the information loaded in the computer as also
\nin the form of a CD-ROM.  In the invoice, the composite price of the
\ncomputer and software is being shown, as noticed hereinbefore and
\ntherefrom, the price of the software is only being deducted.  The invoice
\nprice, thus, also shows the actual price of the computer as also the price of
\nthe software together with the licence to use the same.  The Appellant while
\ncalculating the price of the computer had shown all expenses which are
\nborne by it in terms of the decision of this Court in Union of India and
\nOthers Vs. Bombay Tyre International Ltd. and Others [(1984) 1 SCC 467].
\nThus, the requirements contained in the second part of the definition of
\n‘transaction tax’ are met. Furthermore, invoice value is not always excisable
\nvalue in respect of the goods.\n<\/p>\n
 \tIn the instant case, having regard to the decision of this Court in
\nBombay Tyre International Ltd. (supra) the excisable value of the computer
\nhas been disclosed.  The cost of loading the softwares which would enhance
\nthe value of the goods had also been added.  There cannot, thus, be any
\ndoubt whatsoever that while computing such costs of manufacturing
\nexpenses which would add to the value of the excisable goods (in this case
\nthe computer) must be taken into consideration but not the value of any other
\ngoods which is not excisable.\n<\/p>\n
CLASSIFICATION :\n<\/p>\n
 \tAutomatic data processing machines are classifiable under the sub-
\nheading 84.71.   Softwares, however,  are classifiable under the sub-heading
\n85.24; the duties payable for are 16% and  ‘Nil’ respectively.\n<\/p>\n
Chapter Note 5(a) of Chapter 84 of the Tariff Act  states:
\n“5. (a) For the purposes of heading No. 84.71, the
\nexpression ‘automatic data processing machines’
\nmeans :\n<\/p>\n
(i) Digital machines, capable of (1) storing the
\nprocessing programme or programmes and at least
\nthe data immediately necessary for the execution
\nof the programme; (2) being freely programmed in
\naccordance with the requirements of the user; (3)
\nperforming arithmetical computations specified by
\nthe user; and (4) executing, without human
\nintervention, a processing programme which
\nrequires them to modify their execution by logical
\ndecision during the processing run;”\n<\/p>\n
 \tChapter Note 6 of Chapter 85 states:\n<\/p>\n
“6.Records, tapes and other media of heading No.
\n85.23 or 85.24 remain classified in those headings,
\nwhether or not they are cleared with the apparatus
\nfor which they are intended.”\n<\/p>\n
 \tIt is profitable to notice at this juncture the general principles of
\ninterpretation and in particular Rules 1 and 3 thereof.  The interpretative
\nrules, in our opinion, should be considered keeping in view of the Chapter\n<\/p>\n
(s) of the Tariff Act.\n<\/p>\n
Rule 1 of the Rules for the Interpretation of the First Schedule states
\nthat the titles of Sections and Chapters are provided for ease of reference
\nonly which having regard to Chapter 84 providing for nuclear reactors,
\nboilers, machinery and mechanical appliances; parts thereof are required to
\nbe referred to for reference only.  However, for legal purposes, the
\nclassification is to be determined according to the terms of the headings.
\nThe subject matter of the heading is important.  Once a particular subject
\nmatter falls within the specified classification, the determination of valuation
\nfor the purpose imposition of duty must be done according to the terms of
\nthe heading and any relative Section or Chapter Notes unless such headings
\nor Notes otherwise do not require.  For our purpose, therefore, the rule of
\ninterpretation as contained in Chapter Notes would be given effect to for the
\npurpose of classification in preference to the general rules of  interpretation.\n<\/p>\n
 \tRule 3, on the other hand, refers to a situation where any reference in
\na heading to a material or substance  includes a reference to mixtures or
\ncombinations of that material or substance with other materials or
\nsubstances, as a result whereof the goods are prima facie classifiable under
\ntwo or more  headings.  Only in that event, the different rules of
\ninterpretation specified in Rule 3 may be taken recourse to.\n<\/p>\n
 \tRule 3 pre-supposes three conditions under which goods classifiable
\nunder two or more headings may be classified under one heading or the
\nother.  Such conditions are not applicable in the instant case.  Rules 3 of the
\nRules for interpretation shall not be applicable whereas Rule 1 does.\n<\/p>\n
 \tIn the instant case having regard to the Chapter Note, the legal text
\ncontained in Rule 1 will apply and not Rule 3.\n<\/p>\n
 \tThe softwares, thus, whether they are cleared with the apparatus for
\nwhich they are intended, viz., with the computer or not they remain
\nclassified under the same heading.  By reason of the provisions of  the Tariff
\nAct, the rate of duties specified becomes part of a Parliamentary Act.
\nChapter Note 6 of Chapter 85 being the legal text must be taken aid of for
\nthe purpose of interpretation of the different headings in preference to the
\ninterpretation rules.  Suffice it to point out that once ‘no duty’ is payable on
\nsoftwares being classified under 8524.20 being a magnetic tape, the
\nrecorders whereof is classified under 8520.00, a duty would not be payable
\nonly because the informations contained therein are loaded in the hardware.\n<\/p>\n
 \tIt is not in dispute that operational softwares are available in the
\nmarket separately.  They are separately marketable commodities.  The
\nessentiality test or the functional test cannot be applied for the purpose of
\nlevy of central excise inasmuch as the tax is on manufacture of “goods”.
\nThe Act being a fiscal legislation an attempt  must be made to read the
\nprovisions thereof reasonably. Computer comes within the definition of
\nexcisable goods.  So is a software.  They find place in different
\nclassifications.  The rate of duty payable in relation to these two different
\ngoods is also different.\n<\/p>\n
 \tIn terms of Chapter Note 6 of Chapter 85, as noticed hereinbefore, a
\nsoftware retains its character irrespective of the fact as to whether it is sold
\nwith the apparatus, viz., the computer.  Once it is held that the essential
\ncharacteristic of a software is not  lost by reason of its being loaded in the
\nhardware;  having regard to the different sub-headings contained in different
\nchapters of the Tariff Act, the intent and purport of the legislature, in our
\nopinion, cannot be permitted to be withered away only because the
\ninformations contained in a software are loaded in a hardware.  In other
\nwords, as the central excise duty is not leviable on a software in terms of the
\nAct, only because it is implanted in a hardware which can be subjected to the
\nassessment of central excise under different head, the same would not attract
\ncentral excise duty.\n<\/p>\n
ANALYSIS :\n<\/p>\n
 \tWhile calculating the value of the computer the value of the hard disc,
\nvalue of the firmware, the cost of the motherboard as also the costs for
\nloading operating softwares is included.  What is excluded from the total
\nvalue of the computer is the value of the operating softwares like Windows
\n2000, Windows XP which are secondary softwares.  Indisputably, when an
\noperating software is loaded in the computer, its utility increases.  But does
\nit mean that it is so essential for running the computer that exclusion thereof
\nwould make a computer dead box?  The answer to the said question as
\nwould appear from the discussions made hereinafter must be rendered in the
\nnegative.  It is not disputed before us that even without operational softwares
\na computer can be put to use although by loading the same its utility is
\nenhanced.  Computers loaded with different operational softwares cater to
\nthe specific needs of the buyer wherefor he is required to place definite
\norders on the manufacturer.  It is also not in dispute that an operating
\nsoftware loaded on the hard disc is erasable.  It is also accepted that the
\noperating software despite being loaded on to the hard disc is usually
\nsupplied separately to the customers.  It is also beyond any controversy that
\noperating software can be updated keeping in view the development in the
\ntechnology and availability thereof in the market without effecting the data
\ncontained in the hard disc.  Concededly, even in the case of hard disc crash
\nthe software contained in the CDs is capable of being reloaded on to the hard
\ndisc and its utility by the users remain the same.  An operational software,
\ntherefore, does not form an essential part of the hardware.\n<\/p>\n
CASE LAWS :\n<\/p>\n
 \tIn PSI Data Systems Ltd. (supra) this Court in paragraph 2 of the
\njudgment excluded a firm or etched software and not the operational
\nsoftware.  It has been clarified that the softwares with which the Bench was
\nconcerned were tangible softwares of the nature of discs, floppies and CD-
\nROMs.  It is not in dispute that the operational softwares despite being
\nimplanted in the computer retain its characteristic of a tangible software of a
\nCD-ROM and can be marketted separately.  This Court also noticed that the
\ncomputers and softwares are classified differently in different chapters being
\nChapter Nos. 84 and 85 under the heading 84.71 and heading 85.24
\nrespectively.\n<\/p>\n
 \tDrawing a distinction between a computer system and a computer, it
\nwas  held:\n<\/p>\n
“12. In the first place, the Tribunal confused a
\ncomputer system with a computer; what was being
\ncharged to excise duty was the computer.”\n<\/p>\n
 \tIt was furthermore opined:\n<\/p>\n
“13. Secondly, that a computer and its software are
\ndistinct and separate is clear, both as a matter of
\ncommercial parlance as also upon the material on
\nrecord. A computer may not be capable of
\neffective functioning unless loaded with software
\nsuch as discs, floppies and CD ROMs, but that is
\nnot to say that these are part of the computer or to
\nhold that, if they are sold along with the computer,
\ntheir value must form part of the assessable value
\nof the computer for the purposes of excise duty. To
\ngive an example, a cassette recorder will not
\nfunction unless a cassette is inserted in it; but the
\ntwo are well known and recognised to be different
\nand distinct articles. The value of the cassette, if
\nsold along with the cassette-recorder, cannot be
\nincluded in the assessable value of the cassette
\nrecorder. Just so, the value of software, if sold
\nalong with the computer, cannot be included in the
\nassessable value of the computer for the purposes
\nof excise duty.”\n<\/p>\n
 \tThe functional test or the essentiality test, thus, had been given a
\ncomplete go by therein and, thus, it is not possible to agree that without an
\noperating software, the computers would become disfunctional.\n<\/p>\n
 \tThe decision in the case of PSI Data Systems Ltd. (supra) has been
\nfollowed by this Court in O.R.G. Systems Vs. Commissioner of Central
\nExcise, Vadodara [1998 (102) ELT 3 (SC)].\n<\/p>\n
\tIn O.R.G. Systems (supra), the principal issues in controversy were:
\n“(a) whether the computers manufactured and
\ncleared by the DSI and Orbit are liable to be
\ntreated as the computers manufactured and cleared
\nby the appellant and, therefore, liable for excise
\nduty at the hands of the Appellant; (b) Whether the
\nvalue of peripheral devices and\/ or computer
\nsystems sold by Adprint along with computers are
\nincludible in the assessable value of the Computer;
\nand (c) Whether the amount or value of the service
\ncharges recovered by the Appellant under service
\ncontracts can be included in the assessable value of
\nthe computer.”\n<\/p>\n
 \tReferring to P.S.I. Data Systems Ltd. (supra) in extenso, this Court
\nheld:\n<\/p>\n
“7.The above judgment of this Court completely
\nanswers the principal issues in controversy in
\nfavour of the appellant.  In the case on hand, it
\ncannot be disputed that the computers
\nmanufactured and supplied by Orbit, DSI or the
\nappellant (from May, 1982 onwards) were
\ncomplete computers, which had a Central
\nProcessing Unit, with “etched-in” or “burnt-in”
\nsoftware, a Key Board (input device) the monitor
\n(output device) and Disc drives.  The computers,
\nas above, were cleared after complying with all
\nrequirements under the Excise Law and proper
\nduty as computed was paid.  The peripheral
\ndevices and other systems software were merely
\nadditional devices meant to increase the memory
\nor storage capacity of the computers and other
\nfacilities.  It is also not disputed by the Revenue
\nthat the peripheral devices were imported by the
\nappellant and the appellant had paid countervailing
\nduty on such imported peripherals.”\n<\/p>\n
[See also HCL Hewlett Packard Ltd. Vs. CCE, Meerut, 2000 (116) ELT
\n667]<\/p>\n
 \tWe may notice that the Tribunal in Sprint R.P.G. India Ltd. Vs.
\nCommissioner of Customs, Delhi [2000 (116) E.L.T. 268 (Tribunal)] in a
\nsimilar situation observed:\n<\/p>\n
“9.  The contention of the appellants is that when
\nthe software is loaded on the hard disk drive, it
\nbecomes software and, therefore, is classifiable
\nunder Tariff Heading 85.24 which covers records,
\ntapes and other recorded media, sound or other
\nsimilarly recorded phenomena, including matrices
\nand masters for the production of records.  Further
\ncontention of the appellants is that Note 6 to
\nChapter 85 provides that the records tapes and
\nother media of Heading 85.24 remains classifiable
\nunder this heading whether or not which presented
\nwith the apparatus.  We find that the appellants
\nimported hard disk drive loaded with the software.
\nIt is not the case of the appellants that the software
\nwas assembled with the disk drive.  In fact, the
\nsoftware was installed on the hard disk drive from
\nthe recorded software media for the purpose of
\nexecuting commands to the system.  In these
\ncircumstances, the software becomes an integral
\npart of the hard disk drive.  Therefore, we do not
\nfind any force in the arguments of the appellants
\nthat the goods, in question, are, in fact, software.”\n<\/p>\n
 \tOn an appeal preferred therefrom by the assessee, a Division Bench of
\nthis Court in Sprint R.P.G. India Ltd. Vs. Commissioner of Customs-I, Delhi
\n[2000 (116) E.L.T. 6 (SC) : (2000) 2 SCC 486], upon taking into
\nconsideration the rules of interpretation mentioned in the First Schedule
\nappended to the Customs Tariff Act which lay down the general rules for
\ninterpretation and classification of goods, held:
\n“11. Testing it from the aforesaid rules of
\ninterpretation, it would be clear that the disk or a
\nfloppy on which computer data is recorded, would
\nbe covered by Heading 85.24. Rule 3(a), inter alia,
\nprovides that when two or more headings each
\nrefer to part only of the materials or composite
\ngoods, those headings are to be regarded as equally
\nspecific in relation to those goods, even if one of
\nitem (sic them) gives a more complete or precise
\ndescription of the goods. Further, considering
\nimported goods to be a mixture of two substances
\nnamely “hard disk drive” and “software” as per
\nRule 3(b) they can be classified under the heading
\nwhich gives them their essential character. In the
\npresent case, considering its price factor it would
\nbe computer software. The price of the imported
\nconsignment was approximately Rs. 68 lakhs. As
\nagainst this, the value of the seven hard disk drives
\nwould be roughly Rs. 60,000 that is to say, value
\nof the computer software is hundred times more
\nthan its containers hard disk. Hence, the essential
\ncharacter of the imported goods is computer
\nsoftware.”\n<\/p>\n
 \tWhile reversing the decision of the Tribunal this Court rejected the
\ncontention of the Revenue that in view of Chapter Note 5 of Chapter 84 for
\nthe purposes of Heading No. 84.71, the expression “automatic data
\nprocessing machine” means automatic data processing machines or a unit as
\nbeing a part of a complete system if it meets the conditions specified therefor
\nstating:\n<\/p>\n
“13. He referred to clauses (b) and (c) and
\ncontended that this hard disk drive can be used
\neither directly or through one or more other units
\nfor processing the data and, therefore, it would be
\nautomatic data-processing, machine falling under
\nHeading No. 84.71. This submission cannot be
\naccepted for the consignment in question is
\nessentially a computer software covered by
\nspecific Heading No. 85.24 which is for levying
\nduty on records, tapes and other recorded media
\nfor sound or other similarly recorded phenomena.
\nAs mentioned in the notification dated 16th March,
\n1995, computer software is covered by Heading
\nNo. 85.24. The said notification also covers
\ncomputer software imported in the form of printed
\nbooks, pictures, manuscripts and typed scripts
\ncovered by Chapter 49. Computer software can be
\nbrought either on a floppy or a magnetic tape or on
\na hard disk or in a printed form and hence, what is
\nimported is software on a container which is a hard
\ndisk drive. The value of the containers (hard disks)
\napproximately in the present case is Rs. 60,000 or
\nRs. 65,000. As against this, the cost of the
\ncomputer software is roughly Rs. 67 lakhs.\n<\/p>\n
Therefore, it can be said that what is imported by
\nthe appellant is essentially a computer software.”\n<\/p>\n
 \tWe may also notice that in Shriram Bearings Ltd. Vs. Collector of
\nCentral Excise, Patna [1997 (91) ELT 255 (SC)] this Court while
\nconsidering the question as to whether  where ball bearings fitted with
\naccessories like snap rings, sleeve lock devices, oil seals etc.  would still
\nretain the character of ball bearings or can be subjected to payment of excise
\nduty under a different head, held :\n<\/p>\n
“2. The first issue relates to the value for the
\npurpose of excise duty of ball bearings
\nmanufactured by the assessee.  It was the case of
\nthe assessee that the ball bearings were complete
\nwhen they consisted of the inner ring, the outer
\nring, the ball or rollers and the cage.  Snap rings,
\nsleeve lock devices, cup assemblies, oil seals,
\neccentric collars, dust shields, etc., were
\naccessories and not necessary for the manufacture
\nof the complete ball bearings.  The Revenue,
\nhowever, argued that the duty liability had to be
\ndetermined at the time of clearance and the ball
\nbearings had been actually removed from the
\nappellant’s factory fitted with accessories.
\nTherefore, the composite value thereof was the
\nexcisable value of the ball bearings.  The Tribunal
\nupheld the contention of the Revenue on the basis
\nthat (i) the entire article was cleared as ball
\nbearings; (ii) in the price list, invoices and
\ncatalogue, the assessee had quoted the item as ball
\nbearings and the price for the entire article was
\nstated; and (iii) no separate price was quoted for
\naccessories and the ball bearings.\n<\/p>\n
3. It is not the case of the Revenue that the snap
\nrings, sleeve lock devices, etc., are parts of ball
\nbearings.  It is the Revenue’s case that these are
\naccessories but they were fitted to the ball bearings
\nwhen the ball bearings were removed from the
\nappellant’s factory.  The Tariff Entry at the
\nrelevant time ( No. 49) read, “Rolling bearings,
\nthat is to say, ball or roller bearings, all sorts”.
\nClearly, what fell under this entry were the ball
\nbearings and not what, admittedly, are the
\naccessories thereof.  Accordingly, the conclusion
\nof the Tribunal on this issue must be set aside.”\n<\/p>\n
 \tOnce it is held that the computer is complete without the operating
\nsoftwares, the question of adding the cost of software therewith would not
\narise since what is under assessment is only the computer.  To the same
\neffect is the judgment in Photopone Industries Pvt. Ltd. Vs. CCE, Goa,
\n[1999 (108) ELT 523].\n<\/p>\n
\tIn Philips India Ltd. Vs. Collector of Central Excise, Pune [(1997) 6
\nSCC 31], this Court upon noticing the terms and conditions between the
\nmanufacturer and their dealers stating the same to be one as between
\nprincipal and principal observed that making a deduction on this account
\nwas uncalled for as the advertisement which the dealer was required to make
\nat its own cost benefited in equal degree the Appellant and the dealer.
\nSimilarly, with regard to after-sales service, it was held that the same
\nbenefited not only the manufacturer but also the dealer.  It was observed:\n<\/p>\n
“7. We think that in adjudicating matters such as
\nthis, the Excise authorities would do well to keep
\nin mind legitimate business considerations.”\n<\/p>\n
CONCLUSION:\n<\/p>\n
 \tComputer and operative softwares are different marketable
\ncommodities.  They are available in the market separately.  They are
\nclassified differently.  The rate of excise duty for computer is 16% whereas
\nthat of a software is nil.  Accessories of a machine promote the convenience
\nand better utilization of the machine but nevertheless they are not machine
\nitself.  The computer and software are distinct and separate, both as a matter
\nof commercial parlance as also under the statute.  Although a computer may
\nnot be capable of effective functioning unless loaded with softwares, the
\nsame would not tantamount to bringing them within the purview of the part
\nof the computer so as to hold that if they are sold along with the computer
\ntheir value must form part of the assessable value thereof for the purpose of
\nexcise duty.  Both computer and software must be classified having fallen
\nunder 84.71 and 85.24 and must be subject to corresponding rates of duties
\nseparately.  The informations contained in a software although are loaded in
\nthe hard disc, the operational software does not lose its value and is still
\nmarketable as a separate commodity.  It does not lose its character as a
\ntangible goods being of the nature of CD-ROM.  A licence to use the
\ninformation contained in a software can be given irrespective of the fact as
\nto whether they are loaded in the computer or not.  The fact that the
\nmanufacturers put different prices for the computers loaded with different
\ntypes of operational softwares whether separately or not would not make any
\ndifference as regard nature and character of the ‘computer’.  Even if the
\nAppellants in terms of the provisions of a licence were obliged to preload a
\nsoftware on the computer before clearing the same from the factory, the
\ncharacteristic of the software cannot be said to have transformed into a
\nhardware so as to make it subject to levy of excise duty along with computer
\nwhile it is not under the Tariff Act.\n<\/p>\n
 \tIn other words, computers and softwares are different and distinct
\ngoods under the said Act having been classified differently and in that view
\nof the matter, no central excise duty would be leviable  upon determination
\nof the value thereof by taking the total value of the computer and software.
\nSo far as, the valuation of goods in terms of ‘transaction value’ thereof, as
\ndefined in Section 4(3)(d) of the Act is concerned, suffice it to say that the
\nsaid provision would be subject to the charging provisions contained in
\nSection 3 of the Act as also Sub-Section (1) of Section 4.  The expressions
\n“by reason of sale” or “in connection with the sale” contained in the
\ndefinition of ‘transaction value’ refer to such goods which is excisable to
\nexcise duty and not the one which is not so excisable.  Section 3 of the Act
\nbeing the charging section, the definition of ‘transaction value’ must be read
\nin the text and context thereof and not de’hors the same.  The legal text
\ncontained in Chapter 84, as explained in Chapter Note 6, clearly states that a
\nsoftware, even if contained in a hardware, does not lose its character as such.
\nWhen an exemption has been granted from levy of any excise duty on
\nsoftware whether it is operating software or application software in terms of
\nheading 85.24, no excise duty can be levied thereupon indirectly as it was
\nimpermissible to levy a tax indirectly.  In that view of the matter the decision
\nin PSI Data Systems (supra) must be held to have correctly been rendered.
\n\tWe, however, place on record that we have not applied our mind as
\nregard the larger question as to whether the informations contained in a
\nsoftware would be tangible personal property or not or whether preparation
\nof such software would amount to manufacture under different statutes.\n<\/p>\n
For the reasons aforementioned, we do not find any merit in the
\nappeals of the Revenue which are dismissed accordingly.  However,
\ninterlocutory applications are allowed.  No Costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Commnr. Of Central Excise, … vs M\/S. Acer India Ltd on 24 September, 2004 Author: S.B. Sinha Bench: N. Santosh Hegde, S.B. Sinha, Tarun Chatterje CASE NO.: Appeal (civil) 10185-10186 of 2003 PETITIONER: Commnr. Of Central Excise, Pondicherry RESPONDENT: M\/s. ACER India Ltd. DATE OF JUDGMENT: 24\/09\/2004 BENCH: N. Santosh Hegde,S.B. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-143026","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nCommnr. Of Central Excise, ... vs M\/S. Acer India Ltd on 24 September, 2004 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Commnr. Of Central Excise, ... vs M\/S. Acer India Ltd on 24 September, 2004 - Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004\" \/>\n<meta property=\"og:site_name\" content=\"Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/LegalindiaCom\/\" \/>\n<meta property=\"article:published_time\" content=\"2004-09-23T18:30:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2018-08-09T05:56:59+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1\" \/>\n\t<meta property=\"og:image:width\" content=\"512\" \/>\n\t<meta property=\"og:image:height\" content=\"512\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Legal India Admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@legaliadmin\" \/>\n<meta name=\"twitter:site\" content=\"@Legal_india\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Legal India Admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"40 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004\"},\"author\":{\"name\":\"Legal India Admin\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\"},\"headline\":\"Commnr. Of Central Excise, … vs M\\\/S. Acer India Ltd on 24 September, 2004\",\"datePublished\":\"2004-09-23T18:30:00+00:00\",\"dateModified\":\"2018-08-09T05:56:59+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004\"},\"wordCount\":8006,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"articleSection\":[\"Supreme Court of India\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004\",\"name\":\"Commnr. Of Central Excise, ... vs M\\\/S. Acer India Ltd on 24 September, 2004 - Free Judgements of Supreme Court & High Court | Legal India\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\"},\"datePublished\":\"2004-09-23T18:30:00+00:00\",\"dateModified\":\"2018-08-09T05:56:59+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Commnr. Of Central Excise, … vs M\\\/S. Acer India Ltd on 24 September, 2004\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"name\":\"Free Judgements of Supreme Court & High Court | Legal India\",\"description\":\"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"alternateName\":\"Free judgements of Supreme Court & High Court of India | Legal India\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\",\"name\":\"Judgements of Supreme Court & High Court | Legal India\",\"alternateName\":\"Legal India\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"contentUrl\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"width\":512,\"height\":512,\"caption\":\"Judgements of Supreme Court & High Court | Legal India\"},\"image\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/LegalindiaCom\\\/\",\"https:\\\/\\\/x.com\\\/Legal_india\"]},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\",\"name\":\"Legal India Admin\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"caption\":\"Legal India Admin\"},\"sameAs\":[\"https:\\\/\\\/www.legalindia.com\",\"https:\\\/\\\/x.com\\\/legaliadmin\"],\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/author\\\/legal-india-admin\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Commnr. Of Central Excise, ... vs M\/S. Acer India Ltd on 24 September, 2004 - Free Judgements of Supreme Court & High Court | Legal India","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004","og_locale":"en_US","og_type":"article","og_title":"Commnr. Of Central Excise, ... vs M\/S. Acer India Ltd on 24 September, 2004 - Free Judgements of Supreme Court & High Court | Legal India","og_url":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004","og_site_name":"Free Judgements of Supreme Court & High Court | Legal India","article_publisher":"https:\/\/www.facebook.com\/LegalindiaCom\/","article_published_time":"2004-09-23T18:30:00+00:00","article_modified_time":"2018-08-09T05:56:59+00:00","og_image":[{"width":512,"height":512,"url":"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1","type":"image\/jpeg"}],"author":"Legal India Admin","twitter_card":"summary_large_image","twitter_creator":"@legaliadmin","twitter_site":"@Legal_india","twitter_misc":{"Written by":"Legal India Admin","Est. reading time":"40 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#article","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004"},"author":{"name":"Legal India Admin","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea"},"headline":"Commnr. Of Central Excise, … vs M\/S. Acer India Ltd on 24 September, 2004","datePublished":"2004-09-23T18:30:00+00:00","dateModified":"2018-08-09T05:56:59+00:00","mainEntityOfPage":{"@id":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004"},"wordCount":8006,"commentCount":0,"publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"articleSection":["Supreme Court of India"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004","url":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004","name":"Commnr. Of Central Excise, ... vs M\/S. Acer India Ltd on 24 September, 2004 - Free Judgements of Supreme Court & High Court | Legal India","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/#website"},"datePublished":"2004-09-23T18:30:00+00:00","dateModified":"2018-08-09T05:56:59+00:00","breadcrumb":{"@id":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.legalindia.com\/judgments\/commnr-of-central-excise-vs-ms-acer-india-ltd-on-24-september-2004#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.legalindia.com\/judgments\/"},{"@type":"ListItem","position":2,"name":"Commnr. Of Central Excise, … vs M\/S. Acer India Ltd on 24 September, 2004"}]},{"@type":"WebSite","@id":"https:\/\/www.legalindia.com\/judgments\/#website","url":"https:\/\/www.legalindia.com\/judgments\/","name":"Free Judgements of Supreme Court & High Court | Legal India","description":"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.","publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"alternateName":"Free judgements of Supreme Court & High Court of India | Legal India","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.legalindia.com\/judgments\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.legalindia.com\/judgments\/#organization","name":"Judgements of Supreme Court & High Court | Legal India","alternateName":"Legal India","url":"https:\/\/www.legalindia.com\/judgments\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/","url":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","contentUrl":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","width":512,"height":512,"caption":"Judgements of Supreme Court & High Court | Legal India"},"image":{"@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/LegalindiaCom\/","https:\/\/x.com\/Legal_india"]},{"@type":"Person","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea","name":"Legal India Admin","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","caption":"Legal India Admin"},"sameAs":["https:\/\/www.legalindia.com","https:\/\/x.com\/legaliadmin"],"url":"https:\/\/www.legalindia.com\/judgments\/author\/legal-india-admin"}]}},"modified_by":null,"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/143026","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/comments?post=143026"}],"version-history":[{"count":0,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/143026\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/media?parent=143026"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/categories?post=143026"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/tags?post=143026"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}