TaxTMI 
TaxTMI 
2014 (9) TMI 988
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....1 passed by the assessing officer, by holding that royalty and licensing fee paid by the appellant, M/s. SI Group India Ltd., Mumbai, to the related foreign supplier SI Group, USA is includible in the assessable value of goods imported under the provisions of Rule 10(1)(c)/10(1)(e) of the Customs Valuation Rules, 2007 and allowing the appeal filed by the department in this regard. The said authority also said in the impugned order that a reasonable opportunity should be given to the appellant to submit their defense plea before adjudication. Thus, the impugned order appears to be a remand order for re-assessment. Aggrieved of the same the appellant is before us. 2. The ld. Counsel for the appellant makes the following submissions. ....
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....other non-related foreign suppliers also at or lower prices paid to SI-US. 2.4 There is no restriction on the appellant imposed in any of these agreements that the raw materials should be procured only from SI-US. Therefore, the contention of the department that the royalty/technical fee paid by the appellant should be included in the assessable value of the goods imported from the related foreign supplier has no basis whatsoever as the procurement of technical know how or various consultancy services are not in any way related to the import of raw materials and cannot be considered as a condition of sale of the raw materials. 2.5 A comparison of import price of raw materials from unrelated foreign suppliers indicates that t....
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....r is required to pay; directly or indirectly, as a condition of the sale of the goods being valued, to the extent that such royalties and fees are not included in the price actually paid or payable; (e) all other payments actually made or to be made as a condition of sale of the imported goods, by the buyer to the seller, or by the buyer to a third party to satisfy an obligation of the seller to the extent that such payments are not included in the price actually paid or payable. Explanation. - Where the royalty, licence fee or any other payment for a process, whether patented or otherwise, is includible referred to in clauses (c) and (e), such charges shall be added to the price actually paid or payable for the imported goods, n....
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....apore has anything to do with the purchase of raw materials and the said payment has, in anyway, influenced the purchase price of the raw materials. Therefore, the question of addition of such service fee under Rule 10(1)(e) of the Customs Valuation Rules, 2007 does not arise at all. 4.3 We have also perused the License and Technical Assistance agreement. The agreement envisages supply of technical know-how and updates thereof for the manufacture of the goods specified in the agreement in India by the appellant. In the said agreement, there is no restriction or condition placed on the appellant that it should procure the raw materials from the collaborator. The responsibility for the quality of the goods manufactured rests solely on....
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....lty/licence fee and clause 10(1)(e) relating to other payments are not at all attracted. Accordingly, we accept the contention of the appellant that the relationship has not influenced the supply price of the raw materials. 4.4 As regards the reliance placed by the Revenue on the decisions in the case of Matsushita Television and Audio India Ltd., Essar Gujarat Ltd. and J.K. Corporation, in those cases the buyers of the goods were not free to import the raw materials/component parts from others without the approval of the foreign collaborator, which is not the fact obtaining in the present case before us. Thus the facts are different and distinguishable and hence the ratio of these decisions are not applicable. 4.5 On the co....