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Issues involved:
The issue involves the includibility of royalty charges and distribution charges in the valuation of imported feature films. Summary: Issue 1: Includibility of Royalty Charges and Distribution Charges The appellants imported feature films and contended that the royalty charges paid should be excluded from the assessable value based on Rule 9(1)(c) of the Customs Valuation Rules 1988. They argued that the charges for the right to reproduce and distribute the films should not be added to the price paid for the imported goods. The lower authorities disagreed, stating that the invoice did not provide a split-up of royalty and distribution charges. The Commissioner held that the charges were includible as they were a condition of sale, citing previous judgments. The appellants argued for exclusion based on interpretative rules and international practices, but the Tribunal upheld the lower authority's decision, emphasizing the need for proof of exclusion. Issue 2: Interpretation of Rules and International Practices The appellants relied on interpretative notes and international rulings to support their argument for excluding royalty charges. They referenced rulings from the World Customs Organisation and argued that the charges should be considered as distribution charges alone. However, the Tribunal emphasized the need for concrete evidence and upheld the lower authority's decision based on the invoice declaration and lack of split-up value. Conclusion: The Tribunal dismissed the appeal, stating that the burden of proof for exclusion of charges was on the appellants, which they failed to discharge. The Tribunal upheld the lower authority's decision to include royalty charges in the assessable value based on Rule 9(1)(c) of the Valuation Rules, 1988. The Tribunal emphasized the need for concrete evidence and upheld the lower authority's decision based on the invoice declaration and lack of split-up value.
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