TMI Blog2013 (12) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... ee bearing the trade mark. In other words, these payments are liable to be made in respect of the goods manufactured and sold in India and not in respect of the goods under importation. The goods under importation may be raw materials or components for the manufacture of the goods in India but the royalty and the licence fee are not payable on the imported goods but on the goods manufactured and sold in India. It is evident that the payments made by way of royalty or licence fee has nothing to do with the imported goods nor is it a condition of sale for the imported goods. As already discussed earlier, these payments are required to be made in respect of the rubber products manufactured and sold by the licensee in India. The provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was of the view that the royalty and licence fee paid by the importer is relatable to the goods imported and, therefore, their value should be included in the assessable value of the goods supplied by the foreign collaborator and accordingly ordered that the declared invoice value for the goods imported by M/s. Bridgestone India Pvt. Ltd. from M/s. Bridgestone Corporation, Japan and other affiliates and associates shall be loaded by 4% with effect from 1-4-2005 onwards under Section 14 of the Customs Act, 1962 read with the Customs Valuation Rules, 1988 and Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. 2.2 The importer preferred an appeal before the Commission (Appeals) and the Commissioner (Appeals) vide the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amounts paid towards royalty and licence fee cannot be included in the value of the goods. 6. We have carefully considered the rival submissions. After considering the arguments, we are of the view that the appeal itself can be disposed of as the issue lies in a narrow compass. 7. We have perused the Licence and Technical Assistance Agreement dated 1-4-2005 entered into between the importer and the appellant-collaborator. Clause 8(1) of the agreement deals with the payment of royalty which reads as follows : 8.1 : In consideration of the technical assistance made available by the Licensor to the Licensee pursuant to Article 2 hereof, and the license granted by the Licensor to the Licensee pursuant to Article 5 hereof, the Licensee s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Customs Valuation (Determination of Value of the Imported Goods) Rules, 2007 says that in determining the transaction value, there shall be added to the price actually paid or payable for the imported goods, royalties and licence fees related to the imported goods which the buyer is required to pay directly or indirectly as a condition of sale of the goods being valued to the extent that such royalties and fees are not included in the price actually paid or payable. In other words, the payments made should be related to the imported goods and such payments are condition of the sale of the goods. In the present case, from a reading of the agreement, it is evident that the payments made by way of royalty or licence fee has nothing to d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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