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TMI Blog2006 (2) TMI 315X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal the Commissioner (Appeals) ordered the remand. 2. In remand the Dy. Commissioner found that the appellants were a subsidiary of a company in USA which held 70% of the share capital in the Indian Company. The appellant herein the Indian company was manufacturing heat tracing cable and heat transfer cements in technical assistance with the company in USA. They were importing spares/warranty spares from their collaborators which are impugned herein. 3.1 They had also imported earlier capital goods machinery and equipments from the said collaborators in the year 1992-93. The Dy. Commissioner on basis of the case records on document furnished and submits made held - The Indian company has acquired technical know how and informatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value addition of the product (i.e. to say the cost of the product to be calculated is exclusive of the cost of bought out components and landed cost of imported components (irrespective of the source of procurement.) As such it cannot be added to value of imported components. Also they have not remitted any royally to the principal. Even otherwise the royalty payable for a right to reproduce or to copy the imported goods in India is not to be added to the price paid/payable vide interpretative notes to Rule 9(1)(c) of Customs Valuation Rules, 1988. In view of above and in view of price list furnished and in view of relationship not influencing the price I am inclined to accept invoice value under Rule 4 of Customs Valuation Rules, 1988. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and royalty are conditions of the agreement. The issue of includability of technical know how licence fee was discussed in detail in the judgement passed by the Hon ble Supreme Court in the matter of M/s. Essar Gujarat Ltd, 1996 (88) E.L.T. 609 (S.C.) and State Bank of India v. Collector of Customs, Bombay, 2000 (115) E.L.T. 597 (S.C.) and the same are applicable to the present case also. Therefore both technical know how/licence fee and royalty are clearly includible in the value in terms of Rule 9(1)(b) of Customs Valuation Rules, 1988. 3.3 The Commissioner (Appeals) after hearing the importers concluded. In the written submission made by the importer at the time of hearing, they have stated that in the case of Essar Gujarat, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lumpsum amount paid/payable to collaborator is to be included. In view of method of calculation adopted by the importer in respect of royalty, the same can not be included. Supreme Court decision in the case of Essar Gujarat also supports the case of Deptt. The order of the lower authority is modified to this extent. And disposed off the appeal. Hence the present appeal. 4. Heard both sides and considered the material and it is found - (a) there is no material in the records or produced before us to find that the invoice value could not be transactions value as per Rule 4(3)(a) of the Valuation Rules. Therefore no infirmity in the order of Dy. Commissioner GATT Valuation Cell could be found where he concluded that the relationshi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifications etc. are not for the plant parts/spares/ components under import. Then there additions under Rule 9 as assist permissible cannot be made to the transactions value otherwise determined to be the invoice value. In this case the costs are not for the goods (spares/components) under import. They cannot be added. (c) the issue is well settled by the catena of decisions of the Larger Bench S.D. Technical Service v. CC, 2003 (155) E.L.T. 274 (Tri. - LB) para 5 thereof and in para 4 Revenue contention of application of the decisions in the case of Essar Gujarat Ltd. [1996 (88) E.L.T. 609 (S.C.)] has been considered and not upheld by the Larger Bench being bound following the same we find no merits in the findings of the Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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