TMI Blog2023 (9) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... ls / capital goods only from the foreign supplier. It is very much evident that the Technical Knowhow Fee is not a condition of sale of the imported goods. In COMMISSIONER OF CUS. (PORT), CHENNAI VERSUS TOYOTA KIRLOSKAR MOTOR P. LTD. [ 2007 (5) TMI 20 - SUPREME COURT] , it has been categorically need that the Royalty paid by the appellant to their foreign collaborator does not satisfy the twin conditions of Rule 9(1)(c) cannot be included in the assessable value of the imported goods. Moreover, it is also brought forth that the Department has not filed any appeal against the orders passed in the earlier round of valuation which has been accepted. For this reason also, the appeal cannot sustain - the impugned order does not call for an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the orders accepting the invoice price of the imported goods as transaction value was accepted by the Department. Since, there was no change in the terms of condition of the existing agreement from the principles, the value of technical know how fee or royalty is not includable to the invoice value. Consequently, order was passed for continuance of the order for a further period of three years upto 20.10.2013. Against such order, the Department filed appeal before the Commissioner (Appeals) who vide order impugned herein upheld the order of the original authority holding that the Royalty/Technical Knowhow Fee is not addable to the value of the imported goods as under Rule 10(1)(c) of the Customs Valuation Rules, 2007. 3. The Ld. Auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent and subjected themselves to SVB investigation procedure due to their imports being from the related foreign supplier, GH. Electrotermia, Spain. 4.2 The questionnaire provided by the customs was duly completed and filed for further verification. The Asst Commissioner after affording an opportunity to the respondent, passed an Order-in-Original No. 5685/2006 dated 20.12.2006 accepting the invoice price as transaction value. 4.3 The department had filed an appeal against the above said Order- in-Original No.5685/2006 dated 20.12.2006. The Commissioner (Appeals) vide Order-in-Appeal No. 581/2009 dated 29.06.2009 dismissed the revenue appeal and the same was accepted by the department. In these circumstances, the respondent applied for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the manufacturers or dealers in India or abroad. However, some percentage of components are procured from their principal. Hence there is no condition that the goods should be purchased from their overseas principal only. 5.4 Again, the price of the components, when bought from their principal is higher than the prices from direct independent sources. (Table in para 13 of 0.1.0 dated 20.12.2006). 5.5 In view of above, it is evident that the transaction value is at arm's length, when they buy from their principal. The advantage they derive is that they could buy only the required quantity instead of the minimum order quantity. 5.6 It is submitted, that the respondent had made available the procurement invoice copies of their pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n view of above, the payment of royalty and lumpsum fee are not a condition of sale and hence the same are not includable in the invoice value in terms of rule 9(1)(c) of Customs Valuation (Determination of price of imported goods) Rules, 1998. Therefore, the respondent prays that the appeal filed by the department may please be dismissed. 7. Heard both sides. 8. The issue is whether the Royalty or Technical Knowhow fees has to be included in the assessable value. The copy of the agreement has been placed before us. On perusal of the agreement, it is seen that the Royalty or Technical Knowhow Fee based on the net sales price of all domestic sales of the licensed articles. Further, the respondent is permitted to purchase components fro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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