9911796707
TMI Blog2004 (12) TMI 147X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd., Japan and M/s. Jay Industries, Delhi; that with the object of obtaining the necessary know-how for manufacturing key sets and multi-function switches, they entered into a Technical Assistance Agreement with M/s. Shinghchong Electric Co. Ltd., Korea on 27-10-1997 whereby the Korean Company granted to them exclusive right and licence to manufacture, use and sell these items in India, on payment of Technical Information and know-how fees of one lakh U.S. dollars in three installments; that the Appellants were also obliged to pay the foreign company equal to 3% of the sale of these items to be manufactured in India by the Appellants; that after the matter having been remanded by the Tribunal vide Final Order No. 627/2002 dated 28-5-2002, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is no relationship whatsoever between Shing Chang and Yushin; that there had been no business dealings between the two companies; that thus Shing Chang is neither a parent company nor a subsidiary company; that the impugned Order is based on assumption and presumption which is not sustainable in law; that as there is no mutual interest in the business of each other, they cannot be treated as related person. 4. Finally he submitted that Rule 9(1)(c) of the Customs Valuation Rules is not applicable; that for applying Rule 9(1)(c), the two essential elements required to be satisfied are (i) royalties and licence fee should be related to the imported goods; and (ii) the buyer is required to pay the said fees as a condition of the sale o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransaction value is acceptable for customs purposes under the provisions of sub-rule (3) below. The concept of related person has been defined in Rule 2(2) of the Customs Valuation Rules. There is nothing on record to show that M/s. Shingchang Electric Co. Ltd., Korea is related to the Appellants as no material has been adduced by Revenue to show that either of them directly or indirectly owns, controls or holds 5 per cent or more of the outstanding voting stock or shares of both of them [as mentioned in Rule 2(2)(iv)] or both of them are directly or indirectly controlled by a third person as mentioned in Rule 2(2)(vi) of the Customs Valuation Rules. Merely an agreement for Technical Assistance between the Appellants and M/s. Shingchang El ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, drawings, specifications, processes, etc. There is nothing in the Technical Assistance Agreement to show that the technical information will be provided to the Appellants only when they buy the components or raw material from the foreign supplier. Clause (4) of the agreement also makes this position very clear as it provides that whenever the Appellants' requests at each time during the terms of the agreement, the foreign company shall supply parts, materials, dies, jigs, etc. Clause (4) further mentions that both parties can enter into special supply contract faithfully on each occasion about relevant supplying parts. Thus it cannot be claimed by the Revenue that the fees paid by the Appellants related to the imported goods or that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
