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2019 (2) TMI 889 - AT - CustomsValautaion of imported goods - coating plant - inclusion of fee paid for technical assistance in the assessable value - Rule 9 of the erstwhile Customs Valuation Rules, 1988 read with Section 14 (1) of the Customs Act, 1962 - Held that:- In terms of Rule 9 (1)(c) of the Customs Valuation Rules, Royalty and license fee payable by the buyer to the seller directly or indirectly are required to be added to transaction value subject to two conditions, (i) these are related to the imported goods and (ii) these are payable as a condition for sale of goods being valued. After careful review of the Article 6 along with other clauses of the agreement, it can be concluded that by no stretch of imagination can it be concluded that the payment of US$2 million was a condition for the sale of the coating plant by the supplier to the Respondent. Since the one of the main conditions specified in Rule 9 (1) (c) of the Customs Valuation Rules, 1988 is not satisfied, there is no justification for addition of the said amount to the transaction value of the imported coating plant. In the case of Hindalco Industry Ltd. [2015 (5) TMI 696 - SUPREME COURT], the Hon’ble Supreme Court considered and decided a similar question with reference to the license fee paid for import of capital goods for setting up of a smelter plant. The Apex Court came to a similar conclusion that such license fee pertained to service that was provided post import of the goods for manufacturing and hence, not includible in the transaction value of the imported goods. Appeal dismissed - decided against Revenue.
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