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TMI Blog2018 (1) TMI 724X X X X Extracts X X X X X X X X Extracts X X X X ..... '. The appellant has entered into Distribution Agreement with RIL England as well as Buying Agency Agreement with M/s Adidas International Trading B, V and other agreements. They had made an application before the Special Valuation Branch, New Delhi for approving the transaction value of such imports, since the imports made by the appellant from RIL, England were from related parties. The Directorate of Revenue Intelligence (DRI) investigated the allegation that the appellant was importing goods from RIL, England, but were not including certain costs pertaining to advertising and promotions in the assessable value of the goods at the time of import. After completion of investigation and issue of show cause notice, the impugned order came to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... identical and similar prices. ii. While invoking Rule 3, DRI did not discharge the onus to establish any of the conditions enumerated in Rule 3. The appellants have also relied upon the interpretative note to Rule 3(2)(b) in their defence. That as per this note, activities undertaken by the buyer on its own account, even though by agreement, are not considered indirect payment even though they might be regarded as of benefit to the seller. iii. Rule 10(1)(e) of the Customs Valuation Rules 2007 is not applicable. iv. Statement of Mr Mitra, Finance Director cannot be relied upon as he is not a legal expert. v. Advertisement expenses are post importation expenses and not includible in the assessable value, and advertisement expenses is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dio and/or television) advertising. Details of such expenditure shall be reported quarterly to REEBOK and are subject to annual verification by independent audit." The crux of the dispute is whether such expenditure incurred by the appellant in terms of the above clause will incur the mischief of Rule, 10 (1) (e) of the Customs Valuation Rules. For such payments to be added to the price actually paid, the same should be made as a condition of sale by the buyer to seller or by the buyer to the third party to satisfy the obligation of the seller and such payments are not already included in the price actually paid. There is no doubt that the amount is not already included in the price actually paid or payable. The appellant is allowed to imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s satisfying the obligation of the seller. 9. The Interpretative Note of Rule 3 (2) (b) of the Customs Valuation Rules forbids loading the expenses incurred relating to marketing of the imported goods, if such expanses are incurred by the buyer on his own account even though by agreement with the seller. It is clear from the discussion above that the appellant has incurred such expanses on the expression obligation of RIL England and as a clear condition of the sale of goods for disputing them in India. It cannot be concluded, in the facts of the present case, that the expenditure has been incurred by the appellant on their own account. 10. We have also considered the various case laws cited by the appellant in the appeal as well as argue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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