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TMI Blog2019 (1) TMI 192X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and upheld the Order-In-Original dated 25.2.2011 passed by the Deputy Commissioner of Customs, Gatt Valuation Cell, Mumbai. 2. The issue to be determined in this Appeal is whether the relationship between the parent company i.e. the supplier from abroad and their subsidiary company i.e. the respondent herein, has influenced the import price or not and whether the department is justified in rejecting the transaction value? 3. We have heard ld. Authorised Representative appearing for the Revenue and the General Manager (Finance) appearing for the respondent and perused the record. 4. Although the respondent has produced the documents to show that the parent company had added 11% profit to the cost price and there are invoices to show th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he payments of the contract price to the seller shall be made in US Dollars within 90 days after PPAP approval. Total contract price shall be the fixed amount of US$ 2,212,491 (Two millions two hundred twelve thousand four hundred ninety one only) on the basis of DDU (Inco terms 2000) and it can't be changed during the contract period. As per the terms of contract, if it is necessary to change the contract toolings or buy additional toolings, only then it is possible to change the contract price by mutual agreement. The goods supplied by the parent company to the respondent are the capital goods used in the manufacture of final product i.e. chasis designed by them. These goods can't be used by any other manufacturer. The goods supplied by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Determination of Value of Imported Goods) Rules, 2007. In such cases Rule 3(3) ibid provides as under:- "(3) (a) Where the buyer and seller are related, the transaction value shall be accepted provided that the examination of the circumstances of the sale of the imported goods indicate that the relationship did not influence the price. (b) In a sale between related persons, the transaction value shall be accepted, whenever the importer demonstrates that the declared value of the goods being valued, closely approximates to one of the following values ascertained at or about the same time. (i) the transaction value of identical goods, or of similar goods, in sales to unrelated buyers in India; (ii) the deductive value for identical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2007 which mandatorily require that where the buyer and seller are related and where the circumstances of the sale indicated that the relationship has not influenced the price of the imported goods, the transaction value has to be accepted. Unless the price actually paid for the transaction falls within the exceptions, Customs authorities are bound to assess the duty on the transactional value. The learned Commissioner (Appeals) has given detailed finding in this regard, which is reproduced below:- "The importer has entered into contract with supplier for supply of tooling on 28.01.2010 and vide contract No. CKT-10128-01 between supplier and importer it was understood to effect further sale to GM India. The scrutiny of contract reveals th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1%. Therefore, we do not find any merit in the Revenue's application. Accordingly the same is dismissed." 8. We find that there is no specific reason for the revenue for disregarding the transaction value, other than the suspicion that the profit margin is more than 11%. The Revenue failed to produce any evidence before any of the authorities below in support of its contention. Nor they produced any evidence in that regard before us. They also did not produce any document about contemporaneous import at a higher price. Whereas the respondent had submitted documents such as the Contract Agreement between the respondent and the foreign supplier which provides a basic idea about the terms of sale and payment, copies of invoices etc. The Adju ..... X X X X Extracts X X X X X X X X Extracts X X X X
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