Custom, Excise & Service Tax Tribunal
M/S. Eta General Pvt. Ltd vs Commissioner Of Customs, Chennai on 3 August, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. C/247/2003
(Arising out of Order-in-Appeal C. Cus. No. 251/2003 dated 30.5.2003 passed by the Commissioner of Customs (Appeals), Chennai)
For approval and signature:
Honble Smt. Jyoti Balasundaram, Vice President
Honble Dr. Chittaranjan Satapathy, Technical Member
1. Whether Press Reporters may be allowed to see 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 CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether the Members wish to see the fair copy of the Order?
4. Whether Order is to be circulated to the Departmental authorities?
M/s. ETA General Pvt. Ltd. Appellants
Vs.
Commissioner of Customs, Chennai Respondent
Appearance Shri S. Murugappan, Advocate, for the Appellants Shri V.V. Hariharan, Jt. CDR for the Respondent CORAM Honble Smt. Jyoti Balasundaram, Vice-President Honble Dr. Chittaranjan Satapathy, Technical Member Date of Hearing: 03.08.2009 Date of Decision: 03.08.2009 Final Order No. ____________ Per Jyoti Balasundaram Vide the impugned order the lower appellate authority has accepted the contention of the Revenue that lumpsum of Japanese Yen 50,000,000 paid towards technical documentation and drawings under an agreement entered into by the assessees with M/s. Fujitsu General Limited, Japan and M/s. Fujitsu General Asia Pvt. Ltd. is required to be added under Rule 9(1)(c) of the Customs Valuation Rules to the price under Rule 4 to be accepted as transaction value.
2. We have heard both sides and carefully perused the terms of the Master Technical License and Distribution Agreement dated 22.12.1999. The relevant clause 1.1, 1.8 and 1.9 of the Agreement are reproduced herein below:-
1.1 Licensed Product(s) means each of the air conditioner product(s) of Window Type Model specified in Section 1.22 and the Outdoor Unit(s) of Split Type Model specified in Section 1.21. Licensed Products may be added to both Schedule 1.1 and 1.2 hereto subject to written confirmation of the Parties.
1.8 Technical Assistance means the supply of Technical Documents set forth in Section 4 and the Technical Training set forth in Section5. The fee for the Technical Assistance shall be set forth in Section 5 and 7 hereof. The Technical Assistance shall be limited to the substantial technologies of Licensed Product(s) regarding air conditioners engineering. And the Technical Assistance shall exclude the basics of surrounding technologies of air conditioners engineering and other materials, standards or specifications contained in the Technical Documents.
1.9 Licensed Know-how means all trade secrets, designs, inventions and other information contained in the Technical Documents or otherwise disclosed by FGL to EGPL pursuant hereto, whether in tangible or intangible form and including without limitation information disclosed orally, in documents and/or on floppy disks and/or other media; provided, however, that Licensed Know-How shall not include the Trademark or any patents or other similar intellectual property rights acquired by FGL or coming into existence after the Effective Date. In terms of Rule 9(1)(c) technical know-how fee payable in relation to the imported goods becomes addable. We have gone through the entire agreement including the clause set out above and find that the payment by the assessees cannot be said to be in relation to the imported goods but only in relation to the final products to be manufactured by them in India. The learned Jt. CDR has not been able to bring to our notice any clause in the relevant agreement which would establish that the payment was in relation to the imported goods. We, therefore, accept the contention of the assessees that the payment of Japanese Yen 50,000,000 paid towards technical documentation and drawings is not required to be added to the price, set aside the impugned order and allow the appeal.
(Dictated and pronounced in open court) (Dr. Chittaranjan Satapathy) (Jyoti Balasundaram) Technical Member Vice President Rex ??
??
??
??
4