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2014 (5) TMI 713 - AT - CustomsValuation of goods - Inclusion of royalty in assessable value of goods - Suppression of facts - Invocation of extended period of limitation - Evasion of tax duty - Difference of opinion - Decision of Third member - Bar of limitation - The royalties/licence fees paid for the import of beta / digibeta tapes containing films are includable in the value of the said tapes in terms of Rule 9(1)(c)/ Rule 10(1)(c) of the Customs Valuation Rules, as they stood at the relevant time, inasmuch as such payments were made / required to be made prior to importation in terms of the agreement between the importer in India and the supplier abroad and consequently the demand of differential duty of ₹ 79,19,049/- under the provisions of Section 28(1) of the Customs Act, 1962 is sustainable in law - Held that:- appellants made import of beta tapes and digi-beta tapes falling under Chapter Heading 8523 of the Customs Tariff during the period in dispute. The recorded media in question contains feature films programmes etc. The duty liability under the Customs Tariff was discharged by the appellant only on the cost of media as declared by the courier agency based on invoice submitted by the foreign supplier. As per the sale agreement under which the goods were sold to the appellant on payment of licence fee, the appellant has been given rights such as video rights. Cinematic rights, television rights and other ancillary rights. These rights also include the right to exhibit and right to broadcast. The royalty/licence fee is charged either on a flat lump sum basis or on minimum guarantee basis. As per the agreement, the payment of royalty/licence fee is a condition for sale of the goods in question. The royalties/licence fees paid for the import of beta/digibeta tapes containing films are includable in the assessable value of the said tapes. However, the demand in the present case is time barred and consequently, Customs duty demand with interest and penal consequences are not sustainable - Decided partly in favour of assessee.
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