Windows 7 – India to miss launch because of beneficial Customs exemption?
In his Budget, the Finance minister said, “The IT industry has pointed out that it is facing difficulties in the assessment of software which involves transfer of the right to use after the levy of service tax on IT software service. To resolve the matter, I propose to exempt the value attributable to the transfer of the right to use packaged software from excise duty and CVD.”
And Notification No. 80/2009-Cus., Dated: July 7, 2009 exempted packaged software or canned software, falling under Chapter 85 of the First Schedule of the Customs Tariff Act, 1975 (51 of 1975), from so much of the additional duty leviable thereon under sub-section (1) of section 3 of the said Customs Tariff Act, as is equivalent to the duty payable on the portion of the value of such goods determined under section 14 of the said Customs Act, or the rules made thereunder, read with sub-section (2) of section 3 of the said Customs Tariff Act, which represents the consideration paid or payable for transfer of the right to use such goods.
Legal Corner Icon — the image was hosted by the publisher and was not captured.Windows7, one of the most anticipated launches in recent times from Microsoft, is ready for a worldwide launch tomorrow, but India may miss the launch because of the above beneficial notification.
It seems the packaged software shipments of Windows7 are pending clearance in many Indian ports because of the confusion over the exemption. It seems the importers are being asked for a physical proof of licence for the software. Unfortunately for many a packaged software, the licence is in the software itself. You just don't get a licence printed on a paper and signed.
Windows is perhaps the most pirated software in India – there is hardly any computer without windows and there is hardly any computer with a licenced software. Now with the Customs holding up consignments because they don't understand the beneficial legislation of their Minister, the pirates will have a field day.
People come to do business in India not because of our government but in spite of it!