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TMI Blog2017 (7) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... by all the services that have been paid for above are liable to be added to the value of the products. Appeal dismissed - decided against appellant. - C/00009/2007 - Final Order No. 41122 / 2017 - Dated:- 5-7-2017 - Smt. Sulekha Beevi, Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical) For the Appellant : Shri R. Raghavan, Adv For the Respondent : Shri B. Balamurugan, AC (AR) ORDER Per Bench Facts of the case are that the appellant is a 50:50 joint venture company with equity participation of M/s Hanil Lear Corpn. USA. 2. Dispute in this appeal relates to determination of value for imports by the appellant from M/s Hanil E. HWA Co. Ltd., Korea for the period March 2004 to February 2007. 3. The Special Valuation Branch of Customs conducted enquiry with reference to imports made by appellant from M/s. Hanil E. HWA Co. Ltd., Korea. By an Order-in-Original No.187/2001-SVB, dated 26.02.2001, original authority held that there shall be 20% loading on the invoice price for arriving at the value (for the purpose of payment of duty) for the three years period from March 2001, it till March, 2004. 4. The aforesaid Order-in-Original wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of appeal and made further submissions, which can be summarized as follows:- (i) The impugned Review Order-in-Original and Order-in-Appeal are without jurisdiction, since they seek to direct how value shall be determined for the period 2001 to 2004, when this had already been finalized in Order-in-Original dated 26.02.2001, which was set aside by related Order-in-Appeal dated 31.08.2001. (ii) Since no appeal has been filed against the Order-in-Appeal dated 31.08.2001, the issue remains closed. (iii) The Review Order-in-Original dated 30-03-2006 which is to finalise value for the period from 2004 onwards, cannot suo motu take up the issue regarding valuation for the earlier period upto March, 2004. (iv) Therefore, directions in the impugned Order-in-Original and Order-in-Appeal as regards demands of differential duty for the period between 2001 to 2004 are totally devoid of merit and cannot be sustained. (v) Till date (i.e., May, 2017) notice under sec.28 of the Customs Act, 1962 has not been issued. (vi) There is no possibility to propose addition of ₹ 84,80,744/- paid to M/s. Lear Corporation, USA in as much as admittedly there had been no imports whatsoeve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the joint venture agreement. However, such payment was not found included in the price actually paid or payable; (vi) In the circumstances, lump sum payment of ₹ 84,80,744/- towards Know-how Fee made to M/s. Lear Corporation, USA relates to imported goods and hence, will required to be added to transaction value; (vii) So also, payment of ₹ 4,59,67,972/- was made by appellant towards Technical Assistance/Engineering Fee to the suppliers M/s. Hanil E. HWA Co. Ltd., Korea, which also will require to be added to the assessable value; and (viii) Appellants have suppressed these facts at the stage of the original SVB adjudication in 2001. (ix) Hence, the impugned order invoking extended period was very much in order. 10.1 Heard both sides and gone through the facts. 10.2 After the first import of seats and other interiors passenger cars from M/s. Hanil E. HWA Co. Ltd., Korea, the investigation of relationship between Indian importer and foreign supplier was commenced by the department. It is seen that the SVB of Customs House had registered the matter on 21.11.2000 and asked importer to submit follow-up questionnaire along with relevant documents. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of 26.02.2001, including the portions, therein discussed in para 10.2 above will remain unmodified, untouched and unhindered. 10.5 In the circumstances, then, there is no legal impropriety in the SVB matter having been taken-up for review after three years and a Review Order-in-Original dated 07.04.2006 being its resultant. 10.6 Interestingly, the agreement between M/s. Hanil Lear India Pvt. Ltd., and M/s. Lear Corporation, USA concerning payment to be made for monetary assistance [to check] has been executed on 05.09.1999, well before the first import of the goods and, certainly much in advance of the SVB registration and original authority s proceedings in 2001. It is only based on this agreement, that over a period, a total amount of ₹ 4,59,67,972/- was paid by the appellant to M/s. Lear Corporation, USA towards Technical and Administrative Assistance Fee. 10.7 We also find that the lower authorities have found similar payment of ₹ 84,80,744/- towards Technical knowhow, in foreign currency, by the appellants, right from 2001 onwards, to M/s. Hanil E. HWA Co. Ltd., Korea as per the joint venture agreement. From the portions of the agreement extracted in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... venture agreement and have set up a joint venture Hanil Lear in India for the purpose of manufacture of car interiors such as seating and dash board systems and interior decorations for cars in which fields M/s.Lear Corporation and M/s.Hanil E Hwa are world leaders it would be only in natural to expect that the payment made to M/s.Lear Corporation was towards their technical know how for the mnanufacture of components and other expertise required for the import of these goods into India and therefore this payment has correctly been held to be addable to the value. The appellants have agreed that the payments are towards product design, assistance for tool drawings, Jigs, Fixtures etc for monitoring of project in all respects, testing quality standard / certification / bench marking, new process arrangements and maintenance of molds, machines, equipments and utilities. It would therefore be absurd and incongruous to state that these payments do not relate to the supply of components under import. It would be only natural to assume that the technical know how that has been accrued by way of such payments would go in to each and every product that is imported in to India and thereby ..... X X X X Extracts X X X X X X X X Extracts X X X X
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