The Hon. Supreme Court has held a judgment that the government cannot levy additional 7 % customs duty on laptops.

While dismissing a petition filed by the Commissioner of Customs, a bench headed by Justice S B Sinha said that the government cannot ask IT companies to pay 7 % additional customs duty on notebook PCs, unlike desktops, as the two items were totally different though capable of performing similar functions.

The court upheld the Customs, Excise and Services Tax Appellate Tribunal's earlier judgement, stating that the interpretation by the tribunal was in consonance with the Computers (Additional Duty) Rules, 2004.

The tribunal had passed the order on an appeal filed by Bangalore-based Acer India, challenging the additional levy on imported laptops.

"We are of the opinion that a laptop or a notebook PC being an integrated item cannot be a set of a CPU with monitor, mouse and key board," the court said.

The court has observed that a desktop is a combination of items -- CPU, monitor, mouse and keyboard -- which when put together are capable of making a computer, while notebook computer, on the other hand, comes in an integrated and inseparable form and thus cannot be said to be a set of all these parts.

However, the authorities has challenged that additional duty was compulsory just to provide level-playing filed and protect domestic manufacturers.