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TMI Blog2009 (2) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... n account of stevedering charges. Respondent no. 5 replied by its letter dated 2nd November, 1989 stating that they could arrange for additional licence but the premium would be 35% of the licence value and requested the petitioner to confirm its acceptance. The petitioner did accept the offer by its letter dated 17th November, 1989. Based on this offer and acceptance the principal of the respondent no. 5 namely the respondent no. 6 obtained an additional licence dated 13th March, 1990 for importing Bag-O-Matic Press on the following condition: "The item of capital goods imported against this licence would be disposed of to an actual user." The amount of service charge @35% which is around Rs.12,25,000/- was paid by the petitioner to the respondent no.5 on 20th April, 1990 that is to say almost five weeks after the additional licence was obtained by the respondent no. 6. Thereafter High Seas Sale Agreement dated 1st November, 1991 was entered into between the respondent no. 6 and the petitioner by which parties agreed that the title of the goods would be transferred by the sellor by endorsement of the Original Shipping Documents in favour of the buyer on High Seas Sale basis. Acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce and furnish a bank guarantee for the sum of Rs. 9,20,00/- in favour of the Collector of Customs and also 50% of the demurrage charges payable to the Port Trust authorities in cash and furnish a bank guarantee for the balance 50% of the demurrage charges in favour of the Chairman, Calcutta Port Trust, within a period of one week from date. In default, this interim order of injunction will stand vacated. It is made clear that the above two bank guarantees will be renowed by the petitioners incorporating all the standard clauses. Such renewal of the bank guarantee should be made within a period of 15 days before their respective dates of expiry. It is also made clear that upon fulfilling the conditions as above and also the other necessary formalities, the petitioners will be entitled to clear the goods. All aforesaid payments and furnishing of bank guarantees are, however, without prejudice." The matter was finally taken up for hearing by this Court on 22nd May, 2003 and has been heard from time to time. Lastly it was heard on 30th March, 2004 and this 31st March, 2004. Mr. Khaitan, learned Advocate appearing for the petitioner, has made following submission in suppo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich the Port Trust authority is willing to refund to the petitioner. After hearing the learned counsel for the parties, this court is of the view that in ascertaining the transaction value, the Court has to look at the substance of the matter. It cannot be disputed that the sum of Rs. 12.25 lakhs was paid by the petitioner to the respondent no. 5 who is, in fact, an agent of the respondent no.6, the importer, by way of service charge and/or on account of licence premium. Whether the sum was paid on account of service charge or on account of licence premium, the fact remains that such payment was made in order to require and/or purchase the machine in question. On the top of that, the cost price of the machine charged by the exporter has been paid by the petitioner directly to the bank when the bill of lading was endorsed in its favour. The payment of the service charge or the licence premium was a necessary pre-requisite for the purpose of purchasing the aforesaid machinery at the price indicated in the invoice. Without first containing the licence, the petitioner could not have purchased the machine. Therefore, the payment of the aforesaid sum of Rs. 12.25 lakhs is an incidental ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... self. In the present case, the service charges or the licence premium was realised by the respondent no. 5, the agent of the respondent no.6, immediately after obtaining the licence. The present case, in my view, is stronger than that which was before the Apex Court. In the case before the Apex Court, only at the time of purchasing the goods the service charges were paid. In the present case, in the hope that the petitioner will be able to purchase the goods, the petitioner had to pay the sum of Rs. 12.25 lakhs. There is, thus, no real distinction between the case decided by the Apex Court and the case before me. For the aforesaid reasons, the petition fails and is dismissed. All interim orders are vacated. It will be open to the customs authority to encash the bank guarantee and to realise its dues including interest, if any, in accordance with law. In so far as the Port Trust is concerned, it was submitted by Mr. Majumdar that the entire dues of the Port Trust have been realised and the balalnce would be refunded. The Port Trust is therefore directed to act accordingly. There will be no order as to costs. Let xerox certified copy of this order be supplied to the parties e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the proceeds of any subsequent resale, disposal or use of the imported goods that accrues, directly or indirectly, to the seller; (e) all other payments actually made or to be made 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 on the seller, to the extent that such payments are not included in the price actually paid or payable. (2) For the purposes of sub-section (1) and sub-section (1-A) of Sec. 14 of the Customs Act, 1962 (52 of 1962), and these rules, the value of the imported goods shall be the value of such goods, for delivery at the time and place of importation and shall include- (a) the cost of transport of the imported goods to the place of importation; (b) loading, unloading and handling charges associated with the delivery of the imported goods at the place of importation; and (c) the cost of insurance: (Provided thati) where the cost of transport referred to in Cl. (a) in not ascertainable, such cost shall be twenty per cent of the free on board value of the goods; ii) the charges referred to in Cl. (b) shall be one per cent, of the f.o.b value of the goods plus the cost of tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abad Industries Ltd. vs. Union of India, reported in 115 E.L.T. 593 (SC). The appeal has been opposed by the learned advocate for respondent, Ms. Bhattacharya, by contending, inter alia, that to identify the liability to pay under the said Rule 9, the pay requisites for importation and nexus with such importation, any sum as paid required to be considered to identify the transaction value. It has been further contended that the appellant-company itself included the said transaction value in its books and accounts and in the bill of entry, which has been shown as Commission. The relevant document is annexed in the paper book. Learned trial Judge considering this aspect of the matter, accordingly, rejected the writ application by holding that it to be added as a transaction value applying the principle of attribution aforesaid. The respondent has countered the judgments as referred to by Dr. Pal, relying upon the views expressed by the Apex Court in the case Commissioner of Customs (supra), which also has been relied upon by Dr. Pal. Paragraph 16 of the said judgment reads such: "16. Under Rule 9(1) (c), the cost of technical know-how and payment of royalty is includible in the p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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