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TMI Blog2010 (4) TMI 659X X X X Extracts X X X X X X X X Extracts X X X X ..... nts and Shri K.M. Mondal, Counsel on behalf of the Department. 3. The relevant facts in brief are as follows : The appellants imported spares for their factory from M/s. Harnischfeger Corporation, U.S.A. In terms of agreement they paid "FOB value" by opening letter of credit to the USA based supplier. In addition, they also paid 8% (in some cases 10% of FOB value) to M/s. Voltas Ltd. Original authority finalized the provisional assessments in respect of 55 cases of importation and added 8 to 10% of the value paid by the appellants to M/s. Voltas to the assessable value and held that the same was in the nature of agency commission and therefore was required to be added to the assessable value in terms of Rule 9(1)(a) and Rule 9(1)(e) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnischfeger Corporation is not legal and proper. 4.2 He relied upon the following decisions : Commr. of Customs (Port), Kolkata v. J.K. Corporation Ltd. - 2007 (208) E.L.T. 485 (S.C.) Commr. of Customs v. Ferodo India Pvt. Ltd. - 2008 (224) E.L.T. 23 (S.C.) Tata Iron & Steel Co. Ltd. v. Commr. of C. Ex. & Customs, Bhubaneswar - 2000 (116) E.L.T. 422 (S.C.) Collector of Customs (Prev.), Ahmedabad v. Essar Gujarat Ltd. - 1996 (88) E.L.T. 609 (S.C.) Indo Gulf Corpn. Ltd. v. Commr. of Customs (Import), Mumbai - 2009 (234) E.L.T. 312 (Tri.-Mumbai) 4.3 Relying on the above decisions, he submitted that the Hon'ble Supreme Court have laid down as to when payments made to third party can be included in the assessable value in term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra to us in Indian Rupees at rate 8% of the FOB price of spares, on order. For the purpose of computing the quantum of the Engineering & Technical Services Fees so payable to us, the B.C. Selling rate of exchange prevailing on the date of ACN/Bill of Lading shall be applicable". 5.2 He also submits that the activities of Voltas for which they are paid commission, in the words of Voltas Ltd. are as follows : 1. Regular product support visits to all the operating mine sites for inspection of the Shovels, providing technical updates, guidance on repairs and maintenance at "no cost" to the Projects for ensuring optimum availability of the Shovels. 2. Assist Project Engineers, identify actual requirement of spare ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Mahabeer & Co. v. CC, Mumbai-II - 1998 (103) E.L.T. 442 (T) CC, Mumbai v. Iconpaper - 2003 (154) E.L.T. 722 Ranking Prints v. CC, Bombay - 2004 (176) E.L.T. 876 6.1 We have carefully considered the submissions from both sides and closely examined the records produced. It is apparent that there is agency/distributor agreement entered into 1967 itself between Voltas Ltd. and the American based supplier viz. M/s. Harnischfeger Corporation, U.S.A. The documents such as purchase order of the appellants, the quotation by the American supplier and documents of M/s. Voltas Ltd. relied upon clearly referred M/s. Harnischfeger Corporation as the principal and M/s. Voltas Ltd. as the agent or distributor. We have not been shown any agreemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be made as a condition of sale. Assessment of Customs duty must have a direct nexus with the value of goods which was payable at the time of importation. If any amount is to be paid after the importation of the goods is complete, inter alia by way of transfer of licence on technical know how for the purpose of setting up of a plant from the machinery imported or running thereof, the same would not be computed for the said purpose. Any amount paid for post-importation service or activity, would not, therefore, come within the purview of determination of assessable value of imported goods so as to enable the authorities to levy customs duty or otherwise. The Rules have been framed for the purpose of carrying out the provisions of the Act. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f sale of the imported goods" needs to be included in the assessable value. In the present case, we have already held that the payments made to Voltas Ltd. are clearly as part of condition for sale of the imported goods. 6.4 Further, we have noticed from the documents that the payment made by them to M/s. Voltas has no nexus to any services rendered by M/s. Voltas as claimed on by the appellants but only as a condition of sale to the appellants. The present case is clearly covered under Rule 9(1)(e) which reads as under : "all other payments actually made or to be made as a condition of sale of the imported goods, by the buyer to the seller, or by the buyer to a third party to satisfy an obligation of the seller to the extent that s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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