TMI Blog2001 (12) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... ad. There is no transfer or licence of any patent, invention, model or design. The design referred to in the contract is only the design of the equipment required to be manufactured by the supplier abroad and supplied to the purchaser. The information concerning the working of the machine is only incidental to the supply as the machinery was tailor-made for the buyers. Unless the buyer knows the way in which the machinery has been put together, the machinery cannot be maintained in the best possible way and repaired when occasion arises. No licence of any patent is involved. Sub-clause (vi) and also (vii) of section 9(1) would have no application as the design was only preliminary to the manufacture and integrally connected therewith - we a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , manufacturing shop testing, packing up to f.o.b. port of embarkation. In that view of the matter, in our opinion, the transfer of design, if any, vis-a-vis other would not come within the purview of the said Explanation. This aspect of the matter is covered by a Division Bench judgment of the Madras High Court in the case of CIT v. Neyveli Lignite Corporation Ltd. [2000] 243 ITR 459, 463, where it was held as under: "In a contract for the design, manufacture, supply, erection and commissioning of machinery which does not involve licence of the patent concerning the machinery, or copyright of its design, mere supply of drawings before the manufacture is commenced to ensure that the buyer's requirements are fully taken care of and the sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any patent, invention, model or design. The design referred to in the contract is only the design of the equipment required to be manufactured by the supplier abroad and supplied to the purchaser. The information concerning the working of the machine is only incidental to the supply as the machinery was tailor-made for the buyers. Unless the buyer knows the way in which the machinery has been put together, the machinery cannot be maintained in the best possible way and repaired when occasion arises. No licence of any patent is involved. Sub-clause (vi) and also (vii) of section 9(1) would have no application as the design was only preliminary to the manufacture and integrally connected therewith. The other three sub-clauses also in the circ ..... X X X X Extracts X X X X X X X X Extracts X X X X
|