9911796707
TMI Blog1995 (2) TMI 197X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. On behalf of the appellants, Shri T.K. Ramasubramanyan, learned Advocate, with Shri S. Subramanyan, C.A. appeared before us. Shri Ramasubramanyan stated that the Collector (Appeals) had erred in not accepting the appellants contention that the assessable value of the drawings imported by the appellants in terms of the Memorandum of Understanding (MOU) between the appellents M/s. Tractors Farm Equipment Ltd. (TAFE) and M/s. Massey Ferguson Manufacturing Ltd. (MF) was only 10,000 which was the intrinsic value of the goods. He submitted that on perusal of the MOU it follows that it was reached with the express intention to the formulation, provision and supply by MF to TAFE over a period of 3 years of technical assistance, documentat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,000. He added that in pursuance of this arrangement M/s. Wallace Cartwright as the handling agency made their invoice dated 25th February, 1992 to cover the amount of 1,75,000 and billed separately in the same invoice a sum of 10,000 as their charges for segregting, sorting, reproducing where necessary, arranging and packing. He argued that the MOU for technical assistance between the appellants and the arrangement arrived at with M/s. Wallace Cartwright clearly imply that out of the total consideration of 1,75,000 except the amount of 10,000 which represented the cost of making photocopies of original drawings and related services, the balance amount relates to the production of goods which the appellants have the right to reprod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or reproduction of the imported goods in the country of importation. He referred to the illustrative examples given in Paras 61.1 to 61.4 of the Annexure to the said publication under the heading Application of theAgreement to the illustrative examples of the Brussels Definition of Value . 3. On behalf of the respondents, Shri Sharad Bhansali, learned SDR submitted that question whether any part of the payment made by the appellants in terms of the MOU between them and M.F. could be treated as payment towards the rights to reproduce the imported goods not forming a part of the assessable value of the imported goods, will have to be decided strictly in terms of Rule 9(1)(c) of the Customs (Valuation) Rules, 1988. He contended that for thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other related services, the balance amount being the payment on account of the right to reproduce the goods in respect of which the appellants already held the right to reproduce in India, would not form a part of the assessable value of the imported drawings and manuals in terms of Rule 9(1)(c) of the Customs Valuation Rules, 1988. 5. In support of their claim the appellants have relied upon a publication of the Valuation Directorate of the Customs Cooperation Council titled The Brussels Definition of Value and GATT Valuation Agreement. They have contended that the GATT Agreement on Customs Valuation stipulates that the charges for the right to reproduce the imported goods in the country of importation shall not be added to the price in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tly, 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." Interpretative Notes Note to Rule 9(1)(c) 1. The royalties and licence fees referred to in Rule 9(1)(c) may include among other things, payments in respect to patents, trademarks and copyrights. However, the charges for the right to reproduce the imported goods in the country of importation shall not be added to the price actually paid or payable for the imported goods in determining the customs value. 2. Payments made by the buyer for the right to distribute or resell the imported goods shall not be added to the price actually paid or payable for the imported goods if such pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sideration as mentioned therein the specified know-how, technical assistance/documentation as per the essentiality established during the joint study made by the technical personnel of MF and the appellants during the period of six months from 17-5-1991 for the upgradation of specifications, performance and quality standards of all models of tractors so that they could be offered for sale in the world market at internationally acceptable standards. In the said MOU portion `A covers five sets of drawings in relation to manufacture of MF 240 tractors with specific reference to : 1.Components/manufacturing processes etc. of Mark III Hydraulic pump assembly. 2.Four Wheel drive. 3.Oil immersed brake and straight drive near axle assembly. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
