Custom, Excise & Service Tax Tribunal
Haver Ibau India Pvt. Ltd vs Commissioner Of Customs (Import) on 4 August, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,WEST ZONAL BENCH AT MUMBAI COURT No. II APPEAL No.C/88897/13 (Arising out of Order-in-Appeal No.756/MCH/ADC/GVC/2012 dated 11/09/2012 passed by Commissioner of Customs (Appeals), Mumbai) For approval and signature: Honble Mr.Ramesh Nair, Member (Judicial) Honble Mr. Raju, Member (Technical) 1. Whether Press Reporters may be allowed to see :No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it should be released under Rule 27 of the :Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether Their Lordships wish to see the fair copy :Seen of the Order? 4. Whether Order is to be circulated to the Departmental :Yes authorities? ========================================
Haver Ibau India Pvt. Ltd., Appellant Vs. Commissioner of Customs (Import), Respondent Mumbai Appearance: Shri.T Vishwanathan, Advocate for appellant Shri.Ahibaran, Addl. Comm. (AR), for respondent CORAM: Honble Mr. Ramesh Nair, Member (Judicial) Honble Mr. Raju, Member (Technical) Date of Hearing : 04/08/2016 Date of Decision : /08/2016 ORDER NO Per: Raju
1. This appeal has been filed by M/s.Haver Ibau India Pvt. Ltd. They entered into an agreement with Haver Germany for manufacture of certain products in India. For the purpose of transfer of technology and import of goods, they entered into an agreement with Haver Germany. The said agreement involved payment of royalty under certain circumstances. The matter was picked up by the Special Valuation Branch. The Additional Commissioner of Customs vide his order-in-original dated 01/02/2011 rejected the transaction value and held that the appellants are related to Haver Germany under Rule 2 (2) of Customs Valuation Rules, 2007. The order directed that at the time of finalization of provisional assessment royalty mentioned in the agreement may be added to the assessable value under Rule 10 of the Customs Valuation Rules, 2007. The appellant challenged the said order before the Commissioner (Appeals) who vide order dated 13/09/2012 dismissed their appeal. Aggrieved by the said order, the appellants are before the Tribunal.
2. The learned Counsel for the appellant informed that no royalty has been paid during the currency of the said agreement and therefore, there is no question of adding any amount to the assessable value. He argued that while there was a clause for payment of royalty under certain circumstances in the agreement, such circumstances never arose and hence no royalty whatsoever was paid. He argued that under such circumstances, the assessment can be finalized without going into the issue of includability or otherwise of the royalty of imports. He further argued that the lower authorities could verify the facts at the time of finalization of assessment.
3. The learned AR argued that the facts are not before him and if any royalty was paid needs to be verified.
4. We have gone through the rival submissions. We find that the assessable value can be enhanced under Customs Valuation Rules, 2007 only if any amount of royalty has been paid by the appellant to the Haver Germany as a condition of sale of goods imported. If no royalty is paid then the entire exercise of determining the includability or otherwise of the royalty become infructuous. Considering the assertion of the learned Counsel that no royalty whatsoever has been paid, we set aside the impugned order and direct the finalization of assessment after due verification of the facts. If for any reason it is found that any royalty has been paid by the appellant to Haver Germany, the Revenue is free to approach the Tribunal for relief.
5. The appeal is disposed of in above terms.
(Pronounced in Court on .) (Ramesh Nair) Member (Judicial) (Raju) Member (Technical) pj 1 2 Appeal No.C/88897/13