ICAI - Cochi - IPR - 23.08.2013

 

  • 8523 80 20 of the Central Excise Tariff Act covers 'Information Technology Software' and the rate is 12%.
  • Supplementary note to the Tariff heading provides that "For the purposes of heading 8523, 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."
  • This indicates that software is considered as goods.
  • Excise Duty at the rate of 12% is applicable.
  • No duty on customised software as well as download of software.
  • MRP System is applicable to packaged software 
  • 8523 80 20 refers to information technology software, which does not attract any basic customs duty.
  • The Supplementary Note to Chapter 85 reads as under:
  • "For the purposes of heading 8523, 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."
  • This indicates that software is considered as goods under customs law.
  • Basic Customs Duty is Nil
  • Since excise duty is applicable, CVD is also applicable.
  • In respect of packaged software which does not require declaration of MRP, there is an exemption from CVD equivalent to the duty payable on the value of goods which represents the consideration for the transfer of right to use goods. 

 

Search Now

Newsletter