Page 84 - GSTL_3rd September 2020_Vol 40_Part 1

18 GST LAW TIMES [ Vol. 40
while the Tribunal is the last fact finding Court, and could have perused and
gone into the question of validity of the agreement so brought on record along
with the present revision.
40. In my opinion, there is no doubt as to the fact that the Company is
dealing in two types of products, namely, the branded software which are sold
off the shelf, which is not under dispute and the other unbranded software,
which is developed according to the specification of the client. These softwares
so developed are undoubtedly are for the clients and the same becomes the
property of the client, the moment it is developed and the assessee Company has
no right over the same, nor it can sell the same to the other clients as a branded
item. But, in the present case during the assessment proceedings when the as-
sessee Company was required by the assessing authority to substantiate the sale
under the head ‘unbranded software’, it was the duty of the Company which
was relying upon the judgment of the Andhara Pradesh High Court and was
claiming difference between the unbranded software and the branded software,
should have placed the basic material, i.e., the agreement or the contract so en-
tered by it with its client to bring the said software out of the purview of the
goods. The assessee failed to bring, not only before the Assessing Authority, First
Appellate Authority as well as the Tribunal the agreement, which it is relying
upon before this Court.
41. In the case of Sasken Communication Technologies (supra) the agree-
ment was placed before the assessing authority, as such it was after the consider-
ation of the agreement that the High Court came to the conclusion that it was the
service provided and was not covered under the definition of ‘goods’ as it being
unbranded software. The decision so relied upon is distinguishable in the pre-
sent case as agreement so executed between the assessee and its clients are being
placed for the first time before this Court in exercise of revisional jurisdiction.
42. As far as challenge to the additional grounds not considered by the
first appellate court as well as by the Tribunal in regard to the sale of computer
hardware to P.W.D. which is exempted under Section 3A of the Act, the Tribunal
had not recorded any finding and has only upheld the order passed by the First
Appellate Authority. It is well settled law that additional grounds can be raised
in the appeal and the Tribunal being the last fact finding Court should have tak-
en note of this fact and recorded a specific finding.
43. In view of the above, the order passed by the Tribunal dated 19-6-
2006 is set aside and the matter is remitted back to the Tribunal to record specific
finding after going through the agreements/contract as to the claim of the as-
sessee in regard to the application of software development and support service
given to its client as unbranded software not covered under the definition of
goods and is a service to the customers.
1 43. The assessee shall place all the agreements/contract so executed by
it with its client during the relevant assessment year before the Tribunal, who
shall consider the same in the light of the judgment of the Apex Court as well as
various High Courts and pass a reasoned and speaking order preferably within a
period of three months from the date of production of a certified copy of this or-
der.
44. The revision is partly allowed.
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1 Paragraph number as per official text.
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