TaxTMI 
TaxTMI 
2025 (7) TMI 9
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....nalty of like amount under section 114A of Customs Act, 1962. Shri Piyush Jayantilal Khatri is also in appeal against imposition of penalty of Rs. 25,00,000 under section 112(a) of Customs Act, 1962 following the finding that the impugned goods were liable to confiscation under section 111(d) and 111(m) of Customs Act, 1962. Likewise, duty liability of Rs. 11,61,644 in relation to imports against four bills of entry and the goods imported bill of entry no. 943214/13.04.2010 is assailed. 2. Learned Counsel for appellant submitted that the determination of 'surrogate value' under rule 9 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 was in breach of provisions thereof as the revised value was adopted by relying deposition of the second-appellant herein as also the proforma invoices, quotations and correspondence affirmed therefrom. It is contended that these evidences of 'under the radar' negotiations reflecting the actual value required affirmation under section 138C of Customs Act, 1962 and, therefore, was lacking credibility for re-determination. It is also submitted that the statements recorded from the other appellant had all been retracted immedi....
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....ibunal, in Saregama India Ltd v. Commissioner of Customs, Airport, Mumbai [2017 (345) ELT 236 (Tri. - Mumbai)], holding that '7. It should be abundantly clear from the Rules that Rule 9 is to be invoked for adjusting the declared value to reflect the components specified therein to reflect the transaction value to be adopted for assessment. Impliedly, the declared price is accepted and subjected to the adjustments when invoking Rule 9. On the contrary, with the rejection of declared price under Rule 10A, the transaction value under Rule 4 becomes irrelevant and, in accordance with Rule 3, the provisions of Rule 5 to 8 are to be applied sequentially. Therein lies the nub in the present dispute the declared price is sought to be rejected under Rule 10A without taking it to its logical conclusion as prescribed in Rule 3 and, instead, the very same rejected price is sought to be adjusted by adding the 'royalty' component as provided in Rule 9 which applies only to the transaction value in Rule 4. On this ground alone, the entire proceedings would fail. xxxx 11. Considering the above factual matrix and on a perusal of the licence agreements, we note an omission in t....
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....ed 12th December, 2002 in which the Central Board of Excise & Customs has referred to applicability of Rule 9(1)(c) of Customs Valuation Rules with the rescinding of exemption notification that had limited duty only to cost of print and cost of freight on imported cinematographic film; its context hardly advances the cause of deeming a 'motion picture' to be inseparable from the media which carries the 'motion picture'. That 'cinematographic films' are goods is not in doubt and, with motion pictures no longer transported in cinematographic films, that 'betacam' tapes are also goods subject to customs duty is not in doubt. The adjudicating authority has, on more than one occasion, referred to 'exploitation rights' of the material in the media. Impliedly, the transaction between the owner of the 'motion picture' and appellant-importer incorporates 'exploitation rights' and, from the contracts, it would appear that the agreement is of, and for, rights. 'Motion pictures' are protected by copyright laws that restrict, viewing, distribution and transmission to those who remit copyright fees. Normally, these are a component of the 'box office' receipts or included in the price sold in 'ho....
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..... xxxxx 19. The decision in re Essar Gujarat Ltd., therefore, does not impact upon such imports which can draw a distinction between royalty on goods imported and royalty as a post-importation condition. Of particular import are the propositions that mere existence of royalty clause in a contract which also covers import of goods does not, ipso facto, mandate adjustment of transaction value; the connection with imported goods must conform to the prescriptions in Rule 9 of Customs Valuation Rules, 1988 (or Rule 10 of Customs Valuation Rules, 2007). It is abundantly clear from the above narration that royalty is hinged upon post-importation manufacture and not on the imported goods per se. The impugned order has erred in including the royalty amounts in the valuation of the 'master tapes' that were imported.' erases the liability on the importer that, admittedly, was to be fastened only by reference to rule 9 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. 4. Learned Authorized Representative drew attention to the email exchanges that had been unearthed during investigation and, in particular, the prices at which transaction was undertak....