9911796707
TMI Blog2004 (9) TMI 213X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellants is a joint venture company of M/s. Pall Corporation, USA, M/s. Filtech Pharmalab Pvt. Ltd. and certain individual promoters; that they are engaged, inter alia, in import of parts of filtration equipment and other filtration products from Pall Europe and Pall Gelman; that they entered into a Licence and Technical Know-how agreement with Pall Corpn. USA for the manufacture of filters and filtration and separation system; that they had also entered into an agreement with Pall Europe to act as their distributor in India as per the Export Price List for resale in India; that as per Licence and Technical Know-how Agreement, the Appellants have to pay running royalty for the period of 7 years at the rate of 5% and 8% of the net ex-f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as a condition for the sale of the imported goods, the question of invoking Rule 9(1)(c) does not arise. He further submitted that the payment of royalty contemplated in Article 12 of the agreement is for the goods manufactured in India; that it is settled law that royalty related to the goods produced in India is not includible in the transaction value of the imported goods. He has relied upon the following decisions :- (1) Tata Timken Ltd. v. CC, Calcutta - 2001 (127) E.L.T. 772 (Tri.) (2) Hoerbiger India Pvt. Ltd. v. CC - 2003 (156) E.L.T. 62 (Tri. - LB) (3) Panalfa Dongwon India Ltd. v. CC - 2003 (155) E.L.T. 287 (Tri. - LB) wherein the Tribunal came to the conclusion after going through the entire agreement that royalty is pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... technical know-how has no relation whatsoever to the goods imported under the Bills of Entry in question. Reliance has also been placed on the decision in the case of Polar Marmo Agglomerates Ltd. v. CC [2003 (155) E.L.T. 283 (Tri. - LB)] and M/s. Barbour Vardhman Threads Ltd. v. CC, New Delhi [Final Order No. 896/04-NB(A), dated 30-8-2004 - 2004 (177) E.L.T. 966 (Tribunal)]. 4. Countering the arguments Shri S. M. Tata, learned Senior Departmental Representative, reiterated the findings as contained in the impugned order wherein the Commissioner (Appeals) has mentioned that on the scrutiny of all the clauses of the agreement, it is not possible to agree with the submissions of the Appellants that royalty payment did not relate to the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r documents required to manufacture the Contract Products specified in Appendix to the agreement which deal with the contract products to be manufactured in India by the appellants. The technical documentations relates to drawings/sketches of the contract products proposed to be manufactured in India. Thus the royalty and fees paid for technical documentation relate to manufacture of contract products in India by the Appellants. There is no material adduced by the Revenue to show that the royalty or technical documentation fees payable is a condition pre-requisite for supply of goods by the foreign supplier. Under Rule 9(1)(c) of the Customs Valuation Rules, the cost of royalty and technical know-how is includible if the same is to be paid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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