TaxTMI 
TaxTMI 
2014 (12) TMI 649
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....ity and has held that royalty or any lump sum payment is to be examined for inclusion in the value of the imported goods in the context of Rule 10(1)(c) of the Customs Valuation Rules, 2007. Aggrieved of the same, the appellant is before us. 2. The fact of this case is that the Appellant are engaged in the manufacture of various compressed air and gas equipments, construction and mining equipments, generators, industrial tools and assembly systems and for which they are registered under the provisions of Central Excise Act, 1944. They import parts and components from their related foreign entity M/s Atlas Copco Air Power, Belgium and other related parties for the manufacture of the aforesaid equipments. The Appellant pay royalty to their....
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....ntation dated 21.06.2010 which was disposed of by the Assistant Commissioner of Customs, GATT Valuation Cell, Mumbai vide order dated 28.01.11 wherein the earlier order dated 26.04.95 was maintained; ordered to accept declared invoice price in case of import made by the Appellant from M/s. Atlas Copco Air Power, Belgium and associate companies under Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 and Customs Valuation (Determination of Price of Imported Goods) Rules, 2007 for a period from the date of the expiry of the earlier Order-in-Original dated 26.04.95 till the expiry of this order; also mentioned that if contemporaneous imports at higher prices are noticed or there exists reasons other than the influence of ....
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....ensee exclusive of excise duties taxes and levies, minus the cost of standard bought out components and the landed cost of imported component, irrespective of the source of procurement; there is no condition in the agreements that goods are to be solely sourced from related foreign suppliers, in fact the goods were procured from various other foreign suppliers and also domestic suppliers. It is his submission that royalty is not the condition of sale in respect of the goods imported from related foreign suppliers, therefore in the present case there is no application of Rule 10(i)(c) and (e) of Customs Valuation Rules, 1988/2007. He placed reliance on the following judgments in support of his submission: (i) CC (Port),....
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....y to find out that how in the present case, the earlier order is applicable or otherwise. It was found that the fact of the earlier case and of present case are identical. Ongoing through the agreements involved in the past case and in the present case, it is seen that terms are exactly same. Therefore, since there is no change in the facts and circumstances in the present case as compared to the earlier case, the present case is squarely covered by the Tribunal's order dated 16.11.2005 in the Appellant's own case. The order passed by the lower appellate authority ignoring the above vital fact, suffers from serious infirmity. 10. The Ld. Lower appellate authority proposed to include the royalty amount in the value of the imported....
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....buyer is required to pay, directly or indirectly, as a condition of the sale of the goods being valued. In present case, on analyzing the facts in this regard, we observe that ingredients of the aforesaid rule does not exist in the import transaction of components made by the Appellant from the foreign associate companies. To further ascertain that whether in the case in hand, Rule 10(1)(c) is applicable or otherwise, it is necessary to know the nature of technical knowhow and royalty paid therefore, which can be known better from the Agreement between the Appellant and the foreign suppliers. The relevant article of the Agreement is reproduced as under: 6.1 in consideration of the licensor providing to the licensee Tec....
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.... raw-materials procured from the related foreign supplier or value of the imported components procured irrespective of origin. In these set of facts, Rule 10(1)(c) of Customs Valuation Rules, 2007 is not applicable, hence the finding of the Ld. Commissioner (Appeals) patently incorrect and not sustainable. 11. As regard reliance placed by the Ld. Commissioner (Appeals) on the case of Matsushita Television & Audio (I) Ltd. supra, it was found that in the said judgment the fact was that the Royalty payment to collaborator was 3% of sales turnover of final product, including the cost of imported component by which it became the condition of sale of finished goods. Whereas, in the present case the cost of imported goods is admittedly not inc....