9911796707
TMI Blog2015 (1) TMI 884X X X X Extracts X X X X X X X X Extracts X X X X ..... .01 and 7.05, it is abundantly clear that royalty is required to be paid only on the value addition achieved by the appellant undertakes by the activities undertaken in India. It has nothing to do with the value of the imported raw-materials procured from the related foreign supplier or value of the imported components procured irrespective of origin. Thus, the contention of the Revenue that relationship has influenced the price of imports is not borne out from terms and conditions of the agreement which the appellant had entered into with the foreign supplier. This issue has been examined at length by this Tribunal in a number of cases and in particularly in the Foseco India Ltd. case (2014 (5) TMI 203 - CESTAT MUMBAI) wherein it was held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant is before us. 2. The learned Counsel for the appellant submits that while coming to the above conclusion, the lower appellate authority has referred to a joint venture agreement as per which the appellants importer herein initially undertakes selling of the imported product in the open market; in the second stage standard products will be imported and in the final stage critical products will be imported, while the rest will be manufactured locally. However, the learned Counsel submits that there is no joint venture agreement made between the appellant and related foreign entity as mentioned in the impugned order. The importer is having one collaboration agreement dated 14/08/1996. In terms of the said collaboration agreement the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the source of procurement including ocean freight, insurance and customs duties. These two exclusions make it abundantly clear that royalty is required to be paid only on the indigenous value addition that is taking place and it has nothing to do with the imported goods procured by the appellant either from the Lord or from anywhere else. In these circumstances, the conclusion of the lower appellate authority that the relationship has influenced the prices of the raw materials does not stand the scrutiny of law and accordingly, the impugned order merits to be set aside. He also relies on the decision of the Tribunal in the case of ABB Ltd. Vs. CC (Import), Mumbai - 2013 (288) ELT 296 (Tri-Mumbai), CC (Import), Mumbai Vs. Bridgestone Indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l. We have perused the terms and conditions of the collaboration agreement. From a reading of the clauses 8.01, 11.01 and 7.05, it is abundantly clear that royalty is required to be paid only on the value addition achieved by the appellant undertakes by the activities undertaken in India. It has nothing to do with the value of the imported raw-materials procured from the related foreign supplier or value of the imported components procured irrespective of origin. Thus, the contention of the Revenue that relationship has influenced the price of imports is not borne out from terms and conditions of the agreement which the appellant had entered into with the foreign supplier. This issue has been examined at length by this Tribunal in a number ..... X X X X Extracts X X X X X X X X Extracts X X X X
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