Valuation of imports from related suppliers and the inclusion or ...

Customs valuation: Royalty inclusion for related party imports based on pricing influence.

Case Laws Customs

October 16, 2024

Valuation of imports from related suppliers and the inclusion or exclusion of royalty in the transaction value. The key points are: Rule 10(1)(c) of the Customs Valuation Rules, 2007 allows for the addition of royalty to the transaction value of imported goods. The Supreme Court in CC vs. M/s Ferodo India Pvt Ltd examined the issue and held that technical know-how and royalty payment are includible in the price of imported goods if it is a prerequisite for the supply by the foreign supplier. However, in the present case, the pricing was at arm's length, and the relationship did not influence the price, which was accepted by the department in past transactions between the same parties. The Commissioner (Appeals) rightly held that there was no question of adding royalty to the transaction value. The CESTAT dismissed the Revenue's appeal, considering the Supreme Court's decision in CC vs. M/s Ferodo India Pvt Ltd.

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Valuation of imports from related suppliers and the inclusion or ...

Customs valuation: Royalty inclusion for related party imports based on pricing influence.

Case Laws Customs

October 16, 2024

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